Chile Peso Rises as Chinese Data Boosts Copper Prospects
Chile’s peso rose for the first time in three days as Greek efforts to form a new government and a decline in U.S. jobless claims pushed up copper, boosting trade prospects for the metal’s biggest producer.
The currency appreciated 0.4 percent to 486.25 per U.S. dollar after touching 491.85 yesterday, the weakest intraday level since March 7.
Copper, which accounts for more than half of Chile’s exports, rose as much as 1.5 percent in New York. Greece’s Evangelos Venizelos, the socialist Pasok party leader and former finance minister, said his goal was to form a government that will ensure the nation remains in the euro area. U.S. claims for unemployment benefits fell last week to the lowest in a month. China’s lagging exports and imports encouraged speculation the biggest customer of Chilean copper will move to spur growth.
“After two difficult days, the markets are calmer and copper is recovering,” said Alejandro Araya, a currency trader at Banco Santander Chile in Santiago. “The peso is back in the 481 to 490 range after testing it yesterday.”
The peso often gains against the dollar on Thursdays, a day when exporters sell U.S. currency to buy pesos with which to pay salaries and contracts. Since the start of 2008, the peso has on average gained 0.12 percent against the dollar on Thursday while trading little changed or weakening on other days of the week.
“On Thursday the peso generally appreciates because of local corporate flows, mainly from miners,” Araya said.
Chilean banks and brokers bought $551 million of U.S. dollars from May 3 to May 8, data published today by Chile’s central bank show. Offshore investors had a net long dollar forwards position of $6.8 billion.
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