The dollar rose sharply this Friday in Chile and reached highs of $996, according to BioBioChile. The outlet reported that the US currency opened at $986 on the Bolsa Electrónica de Chile (Chile's electronic stock exchange) and climbed after midday.
At 13:51 it stood at $995.15, up $8.75 from the previous close. According to the report, the pressure came mainly from oil, which remains expensive amid fears that the war in the Middle East will drag on.
Benjamín Neira, account manager at brokerage XTB, said the factor that "really moves the needle" this week is Brent, the international benchmark crude. According to the analyst, it jumped about 8% and touched five-month highs, above US$113 and US$114 per barrel.
Neira attributed that jump to attacks by the Houthis, an armed group from Yemen, on facilities in Saudi Arabia. Those attacks revived fears of supply disruptions and are adding to inflationary pressure worldwide.
Why does it hit the Chilean peso? Lucas Santillán, markets analyst at Capitaria, noted that Chile depends on energy imports. Think of it this way: if the country buys almost all the fuel it uses from abroad, it needs more dollars when the price of a barrel rises, and that makes the currency more expensive.
For your wallet, the effect shows up on two fronts. A more expensive dollar raises the cost of imported goods, from technology to food. In addition, diesel and gasoline prices are calculated using international prices in dollars, so crude and the exchange rate push in the same direction.
Copper acted as a counterweight. Neira said it rose about 1.2% and has gained 43.5% overall, which continues to curb the local dollar's momentum. Uncertainty persists, however, over possible US tariffs on refined copper.
Added to this was the US producer price index (PPI), which measures how much companies charge for their products before they reach consumers. It came in at its highest level since April 2022. Neira urged caution in reading it, since much of the jump reflects copper's own rise.
Santillán added that markets remain cautious after sharp drops in tech stocks on Wall Street. The dollar index (USDX), which compares the US currency with other major currencies, is regaining ground and stands near 101.5 points.
The next signal will come next week, when the Banco Central de Chile (Chile's central bank) holds its monetary policy meeting. There it will set the interest rate, a decision that could move the dollar again.
