Chilean Peso Weakens as Europe Debt Crisis Reduces Risk Demand
Chile’s peso fell for a second day as concern Europe’s sovereign-debt crisis will deepen reduced demand for riskier emerging-market assets.
The peso weakened 0.7 percent to 499.95 per U.S. dollar at the close in Santiago, from 496.59 on Nov. 4. The Chilean currency led losses today among six major Latin American currencies tracked by Bloomberg.
“The market is waiting to see what may happen in Europe, and in the meantime players are taking defensive positions in the dollar,” Sebastian Momberg, a trader at local lender Banco de Credito & Inversiones, said in a telephone interview. “Copper is also falling slightly as demand growth from China has tended to slow down.”
Stocks in Europe retreated, the euro weakened as much as 0.8 percent and Italian bond yields rose today on concern that Italian Prime Minister Silvio Berlusconi will fail to win a majority for a parliamentary vote on a budget report, overshadowing Greece’s announcement yesterday of a unity government.
Copper, Chile’s main export, fell as much as 2.1 percent in New York.
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