Chile Peso Slips From 19-Month High on Outlook for Intervention

Chile’s peso slipped from a 19-month high as concern the central bank may intervene to stem gains countered a rise in copper, the country’s largest export.

The peso weakened less than 0.1 percent to 467.10 per dollar at the close in Santiago. It earlier rallied 0.3 percent to 465.67 pesos, the strongest intraday level since September 2011, after advancing 0.4 percent yesterday.

“What we saw today was a technical adjustment and strong volume for dollars because of the possibility of an intervention,” Sergio Tricio, the head of research at ForexChile, said in a telephone interview. “Volume yesterday in peso trading was low and the gain was a bit excessive.”

The central bank last announced an intervention in Jan. 3, 2011, when the peso reached 465.75 per dollar. The currency gained 1.1 percent in the three sessions through yesterday, after the central bank said last week that the exchange rate was consistent with economic fundamentals. Before that, the peso had traded within a 469 to 476 per dollar range in the previous three months amid concern that a gain to a level stronger than that would trigger an intervention.

Copper, Chile’s main export, advanced 2.1 percent in New York, its biggest gain since January, as a lower-than-expected increase in consumer prices in China eased concern about a tightening of monetary policy in the Asian country.

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