The Peruvian Sol continues to fall against the dollar reaching levels not seen since 2006. Via El Comercio Peru:
The exchange rate rose on Friday to a maximum of more than nine years for purchases of dollars to companies and institutional investors due to increased expectations of a rise in the US key interest rate in December and fears about the health of China’s economy.
The dollar rose 0.21% to S / 3.363 units, matching the level of 7 April 2006. Meanwhile, the parallel exchange rate was S / 3.365.
To mitigate the decline, the Central Reserve Bank (BCR) sold US $ 70 million, at an average exchange rate of 3.3609 units.
During 2015, official sales total US $ 7.569 billion, while the local currency recorded a drop of 12.85%.
“Instability and weakness of China’s economy, the approaching end of the year and the odds for the US Federal Reserve to raise rates, continue to generate demand for dollars from corporate and institutional,” said one agent.