- The Colombian peso fell 2.2% by 11:25 a.m. Eastern time, positioning it for its largest one-day decline since May 4.
- The central bank held rates at 12% on Friday, defying expectations for an increase from 23 of 27 analysts surveyed by Bloomberg.
- The bank also announced a program to build dollar reserves, signaling that policymakers viewed the peso’s prior rally as excessive.
- IBR swaps declined across the curve, with the two-year tenor down 19 basis points.
Quotes
“The Colombian peso is on track for its biggest drop in three months after the central bank unexpectedly paused rate hikes and announced a program to build up dollar reserves, signaling that the currency’s rally has gone too far.”