Colombia’s Peso Leads Gains in Emerging Markets Amid Crude Rallyby
Currency posts biggest advance since March on export outlook
Oil extends rally, while bets on higher U.S. rates ease
Colombia’s peso led gains in emerging-market currencies as a rally in crude oil, its biggest export, bolstered the outlook for international revenue while speculation grew that the Federal Reserve won’t raise rates any time soon.
The peso climbed 2.4 percent to 2,949 at 9:54 a.m. in Bogota, set for the biggest advance since March 17. It was also poised to close stronger than 3,000 for the first time since May 13, following a national holiday on Monday. A gauge of developing-nation currencies tracked by Bloomberg rose for a fifth day, while crude oil extended gains from the highest close in more than 10 months.
Traders have piled into Colombia’s peso as crude has surged 90 percent from a 12-year-low in February and investor demand for riskier assets soars around the world. Emerging-market assets also climbed on Tuesday after Fed Chair Janet Yellen said she expects to raise interest rates only gradually and held off from specifying any time-frame, a shift from her May 27 stance that a move was probable “in the coming months.”
The Colombian peso was “poised to open stronger as U.S. rates pressure has eased,” Banco Bilbao Vizcaya Argentaria wrote in a report. The currency “may be looking at 2,955 for firmer support over the next few sessions.”