The dollar in Colombia closed lower on Wednesday, dropping $15.05, influenced by the U.S. Federal Reserve's rate cut and Jerome Powell's speech. Oil prices also fell, impacted by a potential U.S.-China trade truce. The TRM for today stands at $3,885.29.
The greenback initially recovered on Wednesday following tough comments from Jerome Powell, Federal Reserve Chairman, who stated that internal political divisions and lack of data due to a federal government shutdown could put another rate cut out of reach this year. In Colombia, however, the currency closed at $3,870.24, a drop of $15.05 from the Representative Market Rate (TRM) of $3,885.29. The minimum price was $3,847 and the maximum $3,903, with 1,839 transactions totaling US$1.205 million.
The Fed cut rates by 25 basis points as expected and announced the end of its balance sheet reduction on December 1. The dollar hovered near a two-week high against a basket of currencies at US$99.10.
In the oil market, Brent fell US$53 cents, or 0.82%, to US$64.39 per barrel, while West Texas Intermediate (WTI) dropped US$46 cents, or 0.76%, to US$60.02. This decline stems from investors assessing a potential truce in the U.S.-China trade dispute after a meeting between Donald Trump and Xi Jinping. Trump agreed to reduce tariffs from 57% to 47% in exchange for China resuming U.S. soybean purchases, maintaining rare earth exports, and cracking down on illicit fentanyl trade.
Tamas Varga, analyst at PVM, said that 'investors see the agreement more as a de-escalation of tension than a structural change in the relationship,' noting that lower Brent prices run counter to a sharp reduction in U.S. oil inventories. The Fed improved economic outlooks with the cut but indicated it might be the last of the year due to the government shutdown. Both crudes are headed for over 3% drops in October, marking the third straight month of losses amid oversupply concerns. OPEC+ meets on November 2, likely announcing a 137,000 barrels-per-day increase for December.