The Colombian peso's rate of depreciation will slow in the coming months, amid expectations that an interest rate hike in the United States will be delayed and the fall in oil prices will reach a bottom, a Reuters poll showed on Wednesday. According to analyst projections, the currency will weaken 2.96 percent in the next six months and 4.67 percent during the next 12 months, to a level close to 3,000 pesos per dollar.
The current exchange rate stands at 2,913.74 pesos to the dollar. The expectations contrast with the 43.7 percent depreciation of the currency over the last 12 months due to a shortage of dollars after a global fall in prices for crude, which is Colombia's biggest export and source of foreign exchange. Based on recent data, analysts see less of a chance that the US Federal Reserve will raise interest rates before early next year, said Sebastian Diaz, analyst at Banco de Bogota.
"Also, the historic statistical relationship of the peso with variables like oil has been showing an excessive devaluation and that's now moderating," he added. Analysts said other currencies, like the Brazilian real, the Turkish lira and the South African rand will continue to slide because of fears about global economic growth.
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