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Moody's warned today that the rising dollar has increased the credit risk of several emerging markets. Chile is not vulnerable.
Climb, climb and continue to climb. The dollar has set new heights of 2018 against the Chilean peso and has reached a new psychological barrier, fueled by fears of the trade war.
At the end of trading on the local interbank market, the US currency was located in points of $ 649.70 the buyer and $ 650.00, implying an increase of $ 4.2 over the closing of yesterday and its highest level since mid-December last year.
It is also the fourth increase followed
Experts attribute this increase to the fear that the trade war generates between the two largest economic powers in the world and its eventual effect on the dynamism of the global economy .
It must be remembered that the next July 6, the increase in tariffs on Chinese and American products in the two countries comes into force.
"July 6 is the key day, if it continues to escalate, the problem is not the rate of interest, but the overall growth and before that there are very strong outflows emerging markets, seeking the dollar as a refuge, "said a local operator.
"All badet clbades are dead," added the expert, who believes that the currency will continue to rise in the coming days, in line with risk aversion among investors .
This perspective is shared by Ricardo Bustamante, Investment Analyst of Capitaria . For the expert, "in the very short term", with a low copper content and a dollar that does not stop to increase overall, the exchange rate could reach 655-660 dollars, "where he was born before the second round of elections in our country. "
The $ 650 can serve as short-term support for the currency. The "breakout will potentially pave the way to the December low of 657.5," said George Lei FX strategist, for Bloomberg.
The trade war had a significant effect on commodities, especially copper. Red metal, Chile's main export product and benchmark for the Chilean peso, finished its fourth straight decline on the London Metal Exchange today, with the goal of closing the month of June in red .
comments related to US protectionism to Chinese companies, influencing the -1.21% copper drop, trading at US $ 2.97 per pound For the moment, the dollar is expected to remain bullish, targeting areas close to $ 650, "said Daniel Meriño, market badyst XTB Latam .
Despite this rise and the new barrier reached, Martina Ogaz, of Euroamerica said maintain the volatility scenario badociated with international geopolitical and economic events with an exchange rate between $ 640 / $ 650.
Moody's warning
Moody's warned him today that rising the dollar since mid-April has increased the risk c market of several emerging markets due to the depreciation of their currencies.
The report of the rating agency, reports Reuters, will result in a decline in foreign exchange reserves of countries such that Argentina, Ghana, Mongolia, Turkey and Zambia
Chile Colombia, Indonesia and Malaysia are not vulnerable in the short term warned the report
The dollar index is at its highest since July last year.
The Warning of the ECB
In this context, a report from the European Central Bank (ECB) warned that risks to the global economy had increased.
According to the entity headed by Mario Draghi, the US tax reform could have a stronger impact than expected .
He also noted that "the prospects for increased trade protectionism have increased, which can have a significant impact on global activity."
The bank warns of other risks related to the possibility that conditions will continue to tighten the global financial situation, with changes related to China's reform process and geopolitical uncertainties, particularly linked to the exit of the United Kingdom from the European Union (EU) "Brexit".
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