Colombia President Juan Manuel Santos met with business leaders Friday to discuss possible measures to curb the appreciation of the country’s peso against the dollar.
According to the president, he and employers primarily discussed the effect of a recently enacted tax reform on public debt securities which, said Santos, is contributing to the expensive peso.
“We analyzed the issue of the tax reform’s effect on the public debt securities (TES in Spanish), especially the rate of the TES that dropped domestically which is what is pushing down the entire credit structure,” Santos told press after the meeting.
Business representative Rafael Mejia told radio station W that he had asked the president to push the Central Bank to lower the bank’s interest rate in order to curb the increase in value of the peso against the dollar that according to the business leader is due to an increase in foreign investment in Colombia, mainly in the country’s oil and mining industries.
“Clearly the supply of dollars because of foreign investment has not only affected agricultural exporters, but also the price formation” of the peso, said Mejia.
The dollar has been losing value against the peso steadily since the end of November. Since then, the peso has increased more than 3% in value against the dollar.
Colombia’s central bank is scheduled to meet on Friday. In that meeting, the board of directors is expected to discuss a possible lowering of the interest rate.
