USD
The dollar had a negative week, losing 0.15% week-on-week and closing last Friday at 90.34. Despite the persistent rise in Treasury yields, progress on vaccinations and the prospects for fiscal stimulus, optimism about a global economic recovery, monetary policy that aims to remain loose for an extended period, reports of unemployment benefit claims reflecting the fragility of the U.S. labor market, and market fears about future inflation all consolidated the dollar's consistent weakening.
COP
The Colombian peso had a 2.14% depreciation week, ending last Friday at $3.569,30 pesos per dollar. Colombia is lagging behind its peers in vaccinations, and progress in the process remains very slow. Discussions surrounding tax reform continue without a formal presentation, and neighborhood risk appears to be weighing on the currency, generating strong volatility. Global uncertainty regarding rising Treasury yields, the approval of the fiscal stimulus, and a possible sudden increase in future inflation are depreciating emerging currencies. The upward trend in oil prices, in Colombia's specific case, failed to support the currency's appreciation.
EUR
The euro trended upward throughout last week, rising 0.32% weekly and closing the week in positive territory at US$1.2117. Economic indicators continue to show a flat performance, but German economic sentiment, the increase in manufacturing PMIs, and a positive surprise in retail sales supported the currency's value. However, pessimism stemming from the slow progress of vaccination campaigns and the continued lockdowns and restrictive measures prevented further gains.
The local exchange rate in October showed significant devaluation pressures, which exceeded 8% and consolidated it as the worst performing currency among its peers. Emerging markets showed considerable capital outflows (the largest since June 2013) due to persistent levels of volatility that affected global stock indexes. Asian and Latin American countries were the most affected, where we highlight the significant buying interest in dollars in Colombia by Offshore agents, who accumulated dollars for $3,775 million, mainly in the forward market.
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