Feb. 6 (Bloomberg) -- Chile’s peso closed little changed for the fourth time in five days as concern that the central bank or government would try to stem its gains offset data showing the economy grew faster than forecast.
The peso rose less than 0.1 percent to 472.69 per U.S. dollar from 472.88 per dollar yesterday. It has gained 1.4 percent in 2013.
Chile’s currency has held in a range between 470 and 475 per dollar for the last eight sessions. Faster-than-forecast growth in December and the expectation that the central bank may raise rates this year have prevented it from weakening, while intervention concern has kept it from appreciating through 470 per dollar.
“We still believe the central bank won’t do anything,” said Felipe Hernandez, an economist at Royal Bank of Scotland Plc in Stamford, Connecticut. “It doesn’t make any sense for them to use their limited resources to intervene when the market itself has built a strong resistance at 470 per dollar. Local investors are convinced there’s a risk of intervention below 470, but they are happy to go long pesos at 473 or 474 per dollar.”
Chilean economic activity expanded 4.7 percent in December from a year earlier, the central bank said yesterday. The median estimate of 16 economists surveyed by Bloomberg was 3.7 percent.
The peso climbed to its strongest level since March 2008 in December, according to a trade-weighted index published by the central bank. Chile’s central bank intervened in the currency by buying dollars in April 2008 and again in January 2011.
International investors in the Chilean peso forwards market increased bets against the peso to $914 million on Feb. 4 from a 16-month low of $671 million on Jan. 31.
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