Colombia Peso Gains as Oil Prices Rally; Argentine Peso Slides

By Drew Benson

Feb. 23 (Bloomberg) -- Colombia’s peso led a rebound among most Latin American currencies, rising from its lowest since June 2006, as the price of oil gained on speculation the Organization of Petroleum Exporting Countries will reduce output this month.

Colombia’s currency rose 0.6 percent to 2,565.5 per dollar at 9:09 a.m. New York time, from 2,582 at the end of last week, according to the Colombian foreign-exchange electronic transactions system, known as SET-FX. The peso touched 2,600 per dollar on Feb. 20, its weakest since June 29, 2006.

The yield on the nation’s 11 percent bonds due in July 2020 declined five basis points, or 0.05 percentage point, to 9.92 percent, according to Colombia’s stock exchange. The bond’s price rose 0.367 centavo to 107.045 centavos per peso.

Crude oil, which rose as much as 6.3 percent in New York, is the biggest source of export revenue for Venezuela, Colombia and Mexico.

Chile’s peso gained for the first time in more than a week, climbing 0.8 percent to 618.5 per dollar, from 623.22 on Feb. 20. The yield for a basket of Chile’s five-year, fixed-rate peso bonds was unchanged at 4.1 percent, according to Bloomberg prices.

Copper, Chile’s biggest export, also rebounded after a two- week slide amid a global stock rally as the U.S. government said its major banks are “well capitalized.”

Argentina’s peso slumped for a fifth day, sliding 0.3 percent to 3.5469 per dollar, its lowest since 2002, from 3.5367 on Feb. 20.

To contact the reporter on this story: Drew Benson in Buenos Aires at abenson9@bloomberg.net.