Chile’s peso fell the most in two weeks against the U.S. dollar after a meeting of the Group of 20 nations refused extra resources to help the euro area fight its debt crisis, eroding demand for higher-yielding assets.
The peso declined 0.4 percent to 482.52 per dollar as of 9:52 a.m. in Santiago, from 480.41 per dollar on Feb. 24, heading for the steepest decline since Feb. 14.
The G-20 told Europe to come up with more financial firepower before they will consider lending outside support. The dollar gained against its major trading counterparts and copper, which makes up more than half Chile’s exports, fell.
“It’s triggered to an extent by tension over whether Greece will be able to service its debt,” said Cristian Donoso, a trader at Banchile Corredores de Bolsa SA in Santiago. “No- one committed funds at the G-20. Below 480 pesos, appetite for selling dollars dries up.”
Copper for May delivery fell as much as 1 percent to $3.832 a pound today on the Comex in New York. Copper has appreciated 0.9 percent this month while West Texas Intermediate oil, Chile’s biggest import, gained 9.9 percent.
Offshore investors had a $4.8 billion short position in the peso on Feb. 23, according to central bank data.
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