The US dollar has completed eight weeks without exceeding $4,000 pesos in Colombia, driven by global and local factors like the Federal Reserve's rate cut and increased dollar inflows. Analysts point to the DXY index's weakness and government operations strengthening the peso. This stability benefits imports and travel to the United States.
The US dollar has kept its quotation below $4,000 in Colombia for eight consecutive weeks until October 29, 2025, recording a $128 drop in recent months. This trend is mainly attributed to international events and local decisions that have favored the Colombian peso's 3.25% appreciation between September 2 and October 29, according to Bloomberg.
A key factor was the Federal Reserve's first rate cut on September 17, 2025, of 25 basis points, which weakened the dollar globally. Alexander Ríos, chief economist at Inverxia, explained: “the first 25 basis point cut in September 2025 weakened the dollar globally, as the DXY fell more than 10% in the year, attracting flows to emerging markets like Colombia.” This measure increased investor appetite for emerging markets, reducing dollar demand as a safe haven.
Locally, since September 24, the National Government monetized part of a debt management operation, flooding the market with foreign currencies. Ríos added that “international investors bought local public debt, TES, increasing the dollar supply. In September 2025, this coincided with calm in global markets, reducing uncertainty and strengthening the peso.” Additionally, remittances, government monetizations, and export flows increased.
Geopolitical factors also contributed: possible US-China trade agreements, a Gaza ceasefire, and the decision not to raise tariffs on Colombia. The DXY index's weakness, averaging near 98 points from highs above 115, has appreciated currencies like the euro, British pound, and yen by two digits this year, according to Catalina Tobón of Skandia Colombia.
On October 29, the dollar closed at $3,885.65, with a minimum of $3,866 and maximum of $3,914. Mauricio Acevedo from Corficolombiana noted that this decline makes travel to the US more affordable, boosting tourism compared to $4,500 last year.