Yesterday the dollar closed at $3.950 and fell $39 at TRM, prior to the presidential elections.

The dollar has been one of the most relevant issues, considering that it reflects the purchasing power of Colombians and the state of the economy in international terms.

Although the Market Representative Rate (MRR) has been rising exponentially due to the political risk represented by the votes and various foreign macroeconomic aspects such as the war in Ukraine, a slight drop in risk aversion and the arrival of a new Public Offering of Acquisition to the Colombian Stock Exchange (BVC).

Yesterday, the US currency closed at $3,950.45 on average, which represented a drop of $39.39 against the TRM, which for the day was at $3,989.84.

The opening price registered by the Set-FX platform was $3.945, while the maximum reached $3.980 and the minimum $3.925. In addition, US$1,468 million was traded through 2,772 transactions.

When analyzing the behavior of the greenback at the exchange houses, an average sale price of $3.917 is evidenced, which represents a difference of $72 below what it would cost to acquire a dollar in a bank.

The exchange point that offers the cheapest greenback is Unidivisas at $3.890. It is followed by Alliance Trade, at $3.890; Miss Money, at $3.895; Cambios Vancouver, at $3.895; Cambios Kapital, at $3.900; and Euro Dólar, at $3.900.

In contrast, those selling it more expensively are Giros & Finanzas, at $3,970; Nutifinanzas, at $3,950; Surcambios, at $3,940; Condor, foreign exchange, at $3,930; Latin Cambios, at $3,930; Unicambios; and Cambios El Poblado and Punto Dollar, at $3,920.

“The dollar has been in free fall as international investors buy Treasury bonds in the face of concerns that the global economy will continue to decline, driven by input shortages and the downturn in Asian trade.”

Another factor that marked the behavior of the US currency has to do with the decrease in the cases of covid-19 in China, as this news anticipates a previous opening of the port of Shanghai and dilutes investors’ fears, increasing their appetite for risks.

According to the most recent Survey of Expectations of Banco de la República, analysts expect the price of the US currency to average $4,072.17 on May 31, with a minimum in the projections of $3,950 and a maximum of $4,200.

The Issuer’s survey took into account 39 market players, and the lowest estimate comes to $4,069.64. The average of the eight brokerage firms surveyed expects the price of the currency to be $4,078.5.

What will happen to the currency after the voting?

The price of the dollar in Colombia would start to rise in the next few days, reaching up to $4,100 if the left wins in the next elections. However, this would be a short term effect and it would go back down to $3,800 if said Government does not make drastic decisions or changes against the country’s economic or fiscal policy; and if commodities keep their upward trend. “Whether the right or left goes up, the dollar will tend to go up, as long as the country continues to have high twin deficits,” said José Luis Hernández, institutional trading desk of Corficolombiana.

Source: LA REPÚBLICA

https://www.larepublica.co/finanzas/dolar-cerro-a-3-950-ayer-y-cayo-39-frente-a-trm-previo-a-elecciones-presidenciales-3369377