Chilean Peso Weakens on Copper Drop as Hurricane Threatens U.S.
The currency depreciated 0.3 percent to 481.92 per U.S. dollar as of the close of trading in Santiago. Copper fell as much as 1.9 percent to a seven-week low of $3.482 a pound on the Comex in New York.
The metal makes up half of Chile’s exports and fell on expectations the hurricane battering the U.S. East Coast will slow growth in the world’s largest economy. At the same time stocks in China, the biggest buyer of copper, fell to a one- month low on weaker corporate earnings.
“Copper is falling hard and dropped below $3.50 for the first time in a while,” said Mauricio Olivares, a trader at Bank of Nova Scotia (BNS)’s Chilean unit in Santiago. “That’s the main reason the peso is down. Commodities and stocks have been falling for a week and a half. If commodities reach a floor, the dollar should start weakening against the peso again.”
International investors in the Chilean peso forwards market trimmed bets against the peso to $8.7 billion on Oct. 25 from $9.1 billion a day earlier, according to central bank data.
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