USD/PEN exchange rate decreases on uncertainty

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USD/PEN exchange rate decreases on uncertainty

Peruvian economy and forex

Peruvian economy and forex

This week’s closing time in Lima registered a loss for the US dollar in relation to Peruvian sol. In the Peru’s currency exchange market, the dollar was quoted as S/.3.285 soles per dollar.

The trading floors on currency and Forex sustained the aforementioned behavior for the price of the US currency. Global investors, banks and fund managers supported this trend given the context of uncertainty in US politics for Trump and Russia, as well as the Brazil scandals with Temer’s bribes and Petrobras scandal.

The dollar decreased 0.12% when closing the currency market, the lowest quote price for the USD/PEN trade as compared to May 11th of last year. The dollar finished the trading session being sold for S/.3.278 per dollar.

According to a local Forex trader, this down trend is due to Peruvian Ministry for Transport, Martín Vizcarra, resigning his post. Given the presence of irregularities on the contract for building an airport in the Cuzco region Vizcarra had to quit.

In the informal markets, represented by currency exchange bureaus, which are not regulated, and by autonomous currency exchangers, the rate price for the dollar was oscillating between S/.3.279 soles for buy and S/.3.280 soles for sale. These rates represent a 0.58% variation regarding the last rate by trading closing time.

Local Foreign exchange on the red

Lima’s stock exchange backed up on almost all its indexes, for closing time, according to a report from the BVL stock exchange

S&P/BVL LIMA 25, the main, most liquid and diversified index of Peru stock market, decreased 0.22% when presented 24,366.96 points. The general and selective index lost ground for 0.33% and 0.46% respectively. They both closed at 16,137.92 points for the general and 413.00 points for the selective. The mining index, standing out on BVL, closed for second day in a row with a negative margin of 0.52%, represented by 265.29 points.

Dilma Rouseff Brazil corruption

The ex vicepresident (now president) of Brazil, Michel Temer and Dilma Rouseff

According a financial analyst of Lima, this adjustment was to be expected. The increase in political risk in the US, given the possible involvement of Russia and President Trump during the last US elections, the possible accusation towards Brazil*s president Temer for bribes and for shady characters during the Dilma Rousseff’s impeachment last year, have made this adjustment possible.

The analyst indicated that when metals dropped on the quotes and China restrained the regulating financial market system, the Southeast Asia market took a blow.

Special attention must be paid to the quote for gold, since its rising slightly at 0.11%.

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