Dollar soars amid health reform uncertainty, marches for and against government

The price of dollar in Colombia ended Wednesday, February 15 at an average of $4,878.12, after rising $93.88 from the Market representative rate (TRM), which on the day was at $4,783.24. Awards like this have not been seen since January 6, 2023.

On this occasion, the US currency had a record high of $4,927, while the low stood at $4,825. According to the platform Set-FX, On Wednesday, February 15, over $1,694 million was exchanged in 3,078 transactions.

There volatility of the dollar will continue due to national and international factors among which are the economic policy messages of the Government of Gustavo Petro and rising interest rates United States Federal Reserve (FED)who do the Bank of the Republic of Colombia do the same in order to have an impact on inflation and prevent indebtedness.

However, in recent years important data have become known, among which the one that President Gustavo Petro presented to the Congress of the Republic the project of health reform, a case that prompted the opposition to demonstrate that day against the said initiative. For its part, the inflation rate in the United States, for the seventh consecutive month, stood at 6.4%, or one-tenth less than in December.

Also it was known Economy Tracking Index (ISE) who published the National Administrative Department of Statistics (Den). In this it was revealed that the Gross Domestic Product (GDP) in Colombia, it grew by 7.5% annually and was below expectations in 2022

In this regard, the Associate Professor of the Department of Economics of the Pontificia Universidad Javeriana Andres Felipe Giraldo He assured that since last week a rather volatile trend is observed again because some days the exchange rate goes down slightly and other days it increases or others it increases a little more strongly.

“This reflects the uncertainty of economic agents about the behavior and performance of the economy in the short and medium term. The marches or appeals of the last few days increase this uncertainty because if there is some concern on the economic side in relation to certain government measures,” Giraldo said.

Furthermore, he pointed out that now the political uncertainty by the president’s announcements, which could generate in the environment and then the economic uncertainty moreover, political uncertainty leads to increased exchange rate volatility.

Regarding the new trigger, experts noted that today Colombia is one of the countries in the world where the dollar appreciates the most.

The Economist alexander rivers, lead analyst for Inverxia, indicated that the Colombian peso depreciated at a rate of 5% in February.

“My message is different, if I saw it cheap at $4,500, right now the upside move is already spreading. Be careful,” he said.

On the political instability of the country, assured that there may be some influence, but the truth is a general movement of the currencies of the region.

He Bank of the Republic presented a monthly survey on the expectations of economic analysts. These consider that the dollar It would maintain its value in the Colombian market above $4,700 in the coming weeks. Although it may see rises and falls at different times, the most optimistic analysts believe that the dollar could reach a minimum price of $4,350 and the most pessimistic put it very close to $5,000.