The value of Colombia’s peso continued to fall this week,
dragged down by the lower prices of oil, Colombia’s biggest export. The
currency plummeted to its lowest rate against the dollar since it started
trading freely in 1999. Bloomberg
noted that the central bank is split between those who fear the risk of
inflation and want to raise interest rates and those who are more worried about
slower growth. Ultimately, the central bank decided to maintain the interest
rate at 4.5%.
The Financial
Times at least praised Colombia’s handling of the current oil crisis,
contrasting the Colombian government’s response to that of Russia and Brazil. The
article praised Colombia for its stable policymaking, which has allowed
Colombia to maintain its interest rates alongside the rapid depreciation of its
currency, meaning that Colombia’s oil revenues in Colombian pesos have fallen
relatively little despite the collapse in global prices. Thanks to this clearheaded
policymaking, the Colombian economy is expected to grow by 3.4%, which though
less than last year’s 4.6% growth, is far better than the recessions in store
for Russia and Brazil.
In mining-related news, Colombian daily El
Espectador published an analysis piece tracing the route that Colombia’s
gold exports take out of the country. The
Colombian government knows that a large part of the gold that leaves the
country is mined illegally, with 72% of the 310.3 tons of gold exported by
Colombia in the last 5 years going to companies from the United States, and 83%
of gold coming from unauthorized mines.
No comments:
Post a Comment