Peru’s Sol Rises From 5-Month Low as China Output Boosts Copper
Peru’s sol rose from a five-month low after an increase in Chinese factory output spurred prices for copper, the Andean country’s top export.
The sol strengthened 0.2 percent to 2.8265 per U.S. dollar at 3:33 p.m. New York time, from 2.8318 yesterday. That’s the currency’s biggest rise on a closing basis since Aug. 4.
Copper prices rose to a two-week high after Chinese government data showed manufacturing grew at a faster pace than forecast in November.
“It’s a sign that the Chinese economy can continue growing at a strong pace even with higher interest rates,” said Roberto Flores, an economist at Inteligo SAB in Lima. “The data from the manufacturing sector provides some relief. In recent weeks, the risks of a significant deceleration as a result of monetary tightening had a negative impact on markets.”
The central bank didn’t buy or sell dollars in the foreign exchange market or issue certificates of deposit redeemable in dollars.
The yield on the South American country’s benchmark 7.84 percent sol-denominated bond due August 2020 fell 1 basis point, or 0.01 percentage point, to 5.98 percent, according to Deutsche Bank AG’s local unit. That’s the yield’s first decline in six days.
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