Colombian Dollar: This will move it during the week

 The dollar in Colombia ended last week with new falls and leading the exchange rate to reach $4,000.

The US currency maintains its behavior tied to what is happening with the economic activity of the United States and various local scenarios that include some outcomes of political events.

In this way, the dollar in Colombia , after even having fallen below the $4,000 barrier , is now awaiting new messages from the FED about the future of inflation.

Although in its most recent meeting the FED stated that it did not rule out a new increase in interest rates at the end of the year, there are some data that may lead to a scenario of stability in the future.

On the one hand, for example, the United States labor market left an unemployment rate higher than what the market was predicting.

Will the dollar rise in Colombia?

The above led the market to understand that, at least from the consumption side, inflation could account for a context of stability.

Given the above, the dollar in Colombia, as well as in a good part of developing countries, is seeing a new depreciation by investors who welcome going to other economies.

Additionally, and despite the fact that the war in Gaza intensifies and Russia's invasion of Ukraine does not cease, the price of oil seems to remain stable in the immediate term.

This also means that the dollar in Colombia remains at not so volatile levels since not having a barrel of expensive oil becomes another starting point for the FED to see that inflation is likely to be controlled 

While, on the local side, the political level is what continues to explain a good part of the investor confidence.

The other variables for the dollar

After the regional elections in which there is talk of a significant loss for the Petro government, the dollar in Colombia returned to levels of $4,000.

The above, according to local analysts, leads one to think that the Government would have to seek new political agreements in order to carry out the main reforms of this administration.

In fact, the debate on the health reform was postponed at the request of the opposition and independent bench, which has led to the assumption that the forces in the legislature would have leaned against the executive.

For now, said Finance Minister Ricardo Bonilla, it is very likely that the key reforms will be approved by the first months of next year.

Meanwhile, President Petro's government is doing the math so that the dollar in Colombia ends the year with an average price of around $4,100.

Finally, Colombia is waiting to know the inflation data for the month of October which, according to bets, would leave the annual CPI in the order of 10.5%.