Latin American currencies are beating their high-yielding European peers as improving U.S. economic data benefits assets with links to the world’s largest economy and sheltered from the euro-region debt crisis.
The CHART OF THE DAY shows that while the Colombian peso has jumped 6.1 percent since Dec. 30 and the Chilean currency gained 5.6 percent, the Swedish krona rose 1.6 percent and the Norwegian krone advanced 0.9 percent.
The MSCI World Index of shares rallied 4.9 percent this year, spurring appetite for riskier assets.
“The most interesting trend in 2012 is the strength of the Latin American currencies,” said Bernd Berg, an emerging markets currency strategist at Credit Suisse Group AG in Zurich.
“On the back of stronger U.S. data and a general reduction of risk aversion in global markets they have significantly outperformed European currencies which have been hit by the impact of the sovereign debt crisis.”
Sweden and Norway’s central bank interest rates are both at 1.75 percent, compared with 1 percent in the euro zone and zero in the U.S. Chile’s benchmark rate is 5 percent, and Colombia’s is 4.75 percent.
Swedish manufacturing shrank for a fifth month in December, as the euro-region debt crisis crimped exports, a Swedbank AB purchasing managers index showed on Jan. 2. U.S. initial jobless claims slid to the lowest in almost four years, the Labor Department said on Jan. 19.
bloomberg.com
The CHART OF THE DAY shows that while the Colombian peso has jumped 6.1 percent since Dec. 30 and the Chilean currency gained 5.6 percent, the Swedish krona rose 1.6 percent and the Norwegian krone advanced 0.9 percent.
The MSCI World Index of shares rallied 4.9 percent this year, spurring appetite for riskier assets.
“The most interesting trend in 2012 is the strength of the Latin American currencies,” said Bernd Berg, an emerging markets currency strategist at Credit Suisse Group AG in Zurich.
“On the back of stronger U.S. data and a general reduction of risk aversion in global markets they have significantly outperformed European currencies which have been hit by the impact of the sovereign debt crisis.”
Sweden and Norway’s central bank interest rates are both at 1.75 percent, compared with 1 percent in the euro zone and zero in the U.S. Chile’s benchmark rate is 5 percent, and Colombia’s is 4.75 percent.
Swedish manufacturing shrank for a fifth month in December, as the euro-region debt crisis crimped exports, a Swedbank AB purchasing managers index showed on Jan. 2. U.S. initial jobless claims slid to the lowest in almost four years, the Labor Department said on Jan. 19.
bloomberg.com
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