Colombian central bank board

Bogota Real estate:  Dollar begins to strengthen (finally)

In a combination of moves by the Uribe Administration and international currency traders, the dollar began to strengthen yesterday versus many of the World´s currencies including the Colombian peso.  The central bank in Bogota announced late last week that they would start buying dollars on the currency market in an effort to stop the Colombian peso from strengthening.  The Peso closed at 1,950 pesos to the dollar yesterday.  The peso had not been that weak versus the dollar since September.  Meanwhile, currency traders pushed the value of the dollar up big yesterday, as both oil and gold prices fell sharply.

Is this a trend?  Will real estate investors from the United States once again be more inclined to invest in Bogota real estate?  No one knows for sure, but despite the strengthening of the Dollar yesterday, severe long term debt issues remain.  The fact is that no matter how much the Uribe administration pushes for a weak Peso policy, it is ultimately the Obama administration that will determine the fate of the COP/USD exchange rate.

As an American living and working in Colombia, I feel the strong peso everyday.  A night out on the town now costs 40% more than it did just 7 months ago as do apartments in Bogota.  Unfortunately, the Colombians are the ones really feeling the brunt of the weak dollar.  The prices for Colombian exports are also 40% higher and the government understands that prices like these will not be sustainable long term.  Let´s hope for all of our sakes that the recent trend in the currency market continues.

1. 

   Homes and Properties says:

   November 23, 2009 at 11:22 pm

   I doubt Dollar can keep up with other currencies such as RMB, but I do hope Dollar remains strong

   reply
2. 

   GRE reading comprehension says:

   March 29, 2010 at 6:07 pm

   Dollar will just be fine because Euro isn’t doing great consistently anyway. In addition, the Chinese government will always have their policy that restricts the growth of RMB

   reply

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