Chile’s peso climbed to an eight-week high after the price of copper, the country’s biggest export, rose to a record.
The peso gained 0.6 percent to 476.25 per U.S. dollar as of 7:38 a.m. New York time from 478.95 yesterday. It earlier reached 475.55, the highest level since Oct. 15.
Copper for March delivery surged 2.5 percent to $4.1065 a pound on speculation the U.S. Federal Reserve may increase asset purchases, hurting the dollar and boosting demand for commodities as an alternative investment. U.S. President Barack Obama agreed to extend tax cuts, helping boost stocks and commodities.
“It’s basically the steep rise in copper,” said Eugenio Cortes, a currency forwards trader at EuroAmerica Corredores de Bolsa SA in Santiago. “There’s strong selling pressure so we’ll test the recent lows of 473.5 to 474 and if we break through that we could get to 470 per dollar. Yesterday, with negative markets the pesos still rose, so in a good day it’s rising strongly. Pension funds are taking advantage to sell dollars.”
The National Statistics Institute reported prices rose 0.1 percent in November, less than the 0.2 percent median forecast of 15 economists in a Bloomberg survey.