Chile Peso Snaps Two-Day Drop as Greek Debt Deal Supports Risk

Chile’s peso snapped a two-day decline after European finance ministers agreed to terms of an aid package for Greece, supporting demand for higher-yielding, emerging-market assets.

The peso appreciated 0.2 percent to 480.55 per U.S. dollar at the close in Santiago after dropping 1 percent over the previous two trading days. International investors in the Chilean peso forwards market cut their bets against the currency to a six-month low of $6.9 billion on Nov. 23, data published today by the central bank show.

“The Greek news suggested the exchange rate should have opened lower than it did, but there’s no euphoria,” said Cristian Donoso, a trader at Banchile Corredores de Bolsa SA in Santiago.

European ministers cut the rates on bailout loans, suspended interest payments for a decade, gave Greece more time to repay and engineered a Greek bond buyback. The country was also cleared to receive a 34.4 billion-euro ($44.7 billion) loan installment in December, boosting hopes that the 17-member currency union can survive intact.

International investors sold a net $101 million of dollar forwards on Nov. 23. Local investors bought $393 million of dollar forwards, central bank data show.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE