Colombian Peso Surges to Record High, Policy Makers Concerned Over the High Values

Colombian Peso, the major currency of Columbia has soared to a figure that’s the highest in last 17 months, all thanks to the US budget deal. The US lawmakers have finally been able to pass a bill which will avert tax increases and spending cuts. This so called fiscal cliff threatened the economic condition of not only US, but, numerous other countries as well. According to analysts, the economic recovery process of Columbia would have halted in case; the budget deal was not passed.

Columbian Peso saw an increase of 0.5% against USD and is currently priced at 1757.80 per USD. At one point of time, it actually touched 1750.50 which mark the strongest value for the Columbian Peso since July, 2011. Overall, the major currency of this Latin American country increased by 9.7% in the last year, which is the biggest surge other than Hungarian Forint and Polish Zloty in the major 171 counterparts of the greenback. Not only that, Columbian Peso was also the 3rd best performing currency in the entire world for 2012.

According to an analyst of Helm Bank SA, Marisol Torres, the investors are ecstatic because of the results shown by the Columbian Peso. Incidentally, as soon as the news of the US accord spread, not only Columbia, but stocks of other countries and the entire commodity market also saw surges.

The overall political situation of Columbia has improved a lot ever since the army emerged as victorious against the guerrillas. This led to improvement of the country’s overall oil production and mining sector as well.

However, a surging Columbian Peso has led the lawmakers of the country thinking over its economic policies. The Chief of Columbia’s Central Bank, Jose Dario Uribe has already stated that the huge increase in the Columbian Peso is a big concern for the country’s economy and also reaffirmed the decision of Banco de la Republica buying around $20 million everyday throughout the 1st quarter of 2013. According to economists, the daily purchase can be increased by double to $40 million if the Columbian Peso continues its fine run.

The 10 percent Columbian Peso dominated securities that are due by July, 2024 saw an increase of 2 basis points and is at 5.67% currently. The statistics was released by the Stock Exchange of Columbia.