The Dollar Hits 11-Month Low in Colombia
On Friday, June 23, the price of the dollar in Colombia reached a new low, quoted at $4,114.39. This represents a decrease of 1.05% compared to the previous day’s value of $4,158.21. The US currency hasn’t been this low since June 29, 2022, when it was at $4,089.72.
The representative exchange rate of the market (TRM) increased by 2.18% (87.87 pesos) compared to the same day in 2022. However, it has decreased by 9.15% (414.28 pesos) compared to the previous month. The TRM is determined by the Bank of the Republic and represents the amount of Colombian pesos for one United States dollar.
The Financial Superintendence of Colombia is the sole authority responsible for studying, calculating, and certifying the values of foreign currency in the country. It bases its calculations on currency purchase and sale operations between financial intermediaries operating in the Colombian market.
Movement of the Dollar from June 16 to June 23, 2023
Conversion Table: Dollars to Colombian Pesos
Ous day’s rate of $4,157.20. The decline in the dollar’s value in Colombia is attributed to several factors, including a stronger Colombian peso, a decrease in demand for dollars due to the COVID-19 pandemic, and the country’s recovering economy. This low exchange rate is good news for Colombian imports and travelers, as it makes foreign goods and services cheaper. However, it is worrisome for exporters, as a weaker dollar makes Colombian products more expensive for international buyers. The Colombian government and central bank are closely monitoring the situation and may intervene in the foreign exchange market to stabilize the exchange rate if necessary.
How does the current exchange rate of $4,157.20 impact Colombian exporters?
The impact of the current exchange rate of $4,157.20 on Colombian exporters depends on various factors.
1. Competitiveness: If the exchange rate is favorable for the Colombian exporters, it means that their goods and services become cheaper for foreign buyers. This can enhance their competitiveness in foreign markets and potentially increase export demand.
2. Profit margins: A high exchange rate can affect profit margins for Colombian exporters. If the local currency is relatively strong, exporters may receive fewer Colombian pesos for their foreign currency earnings, potentially reducing their profitability.
3. Import costs: A high exchange rate may make imported inputs and raw materials more expensive for Colombian exporters. This can increase their production costs and potentially reduce their competitiveness.
4. Market fluctuations: Exchange rates are subject to regular fluctuations, and Colombian exporters need to closely monitor these changes. Sudden fluctuations can impact their pricing strategies, profitability, and competitiveness in foreign markets.
5. Inflation: If the current exchange rate is significantly different from the historical rates, it may affect overall inflation levels in the Colombian economy, which can have indirect consequences for exporters.
In summary, the impact of the current exchange rate of $4,157.20 on Colombian exporters can be both positive and negative, depending on various factors such as competitiveness, profit margins, import costs, market fluctuations, and inflation. Continuous monitoring and adaptation to exchange rate changes are crucial for exporters to navigate these impacts effectively.