The dollar fell only a little in its first session with José Antonio Kast as President-elect of the country, since to a large extent this milestone had been internalized by the exchange market, bringing the US currency to minimums in the week before the vote.
The local parity fell $2.4 to $907.3 at the opening this Mondayafter closing on Friday at new lows since October 2024, levels that are partly due to the expectation of a large victory for the Republican candidate, as actually happened this Sunday.
The Chilean peso also has external support. Copper futures rose 1.3% to US$5.3 per poundas an indicator of the global dollar fell slightly, as did US Treasury yields.
“Overall, markets should react positively to the news, even if it is largely discounted. The dollar-peso could test the $900 level and advance towards $880, also helped by new highs in copper and lower oil prices,” published the team of strategists at BBVA led by Alejandro Cuadrado.
“The fact that there is a political shift to a more market-friendly administration should continue to help risk sentiment due to the potential for new investments in Chile. However, a fragmented Congress poses legislative challenges. Kast’s tone was conciliatory in his first speech, although he is not considered a great deal-maker,” he added.
Jorge Herrera, Deputy Manager of Investment Strategy at Principalobserved in a similar vein that the composition of Congress qualifies Sunday’s results, making it clear certain guarantees that no extreme measures will be able to see the light of day, as they do not have the necessary parliamentary majorities.
Yes, the executive pointed out that the exchange rate could continue to fall a little more, since “even though part of the news would already be discounted in the price of financial assets, the integration of the information is never complete until it is actually a fact, so that something of this positive trend could still remain.”
Internationally, dominating the agenda is the release of the US nonfarm payrolls reports for November and October. The lag in these publications is due to the historic 44-day government shutdown, which actually affected data collection to the point that the October report will not include the unemployment rate.
