US dollar opens lower at PEN 3.435 in Peru

The US dollar opened lower on Wednesday, 30 September, at 3.435 Peruvian soles, below its previous close of PEN 3.441. The Peruvian sol appreciated in morning trading as the green currency pulled back globally after a lower-than-expected US inflation report.

US core PCE inflation in August slowed to 0.2% month on month and 3.0% year on year, coming in below market expectations of 0.3% and 3.3%, according to Jorge Luis Huayta, FX trader at Kambista. Huayta noted that the downside surprise reduced upward pressure on Treasury yields and weakened momentum for the dollar, although annual inflation remains above the Federal Reserve's 2% target.

The US macro data coincided with a 0.82% advance in gold, while copper fell 0.38%. In energy markets, oil moved higher amid geopolitical uncertainty in the Middle East. WTI crude gained 1.88% to trade at $90.60 per barrel, and Brent crude rose 2.23% to $101.73.

Locally, Peruvian market participants are awaiting September inflation figures scheduled for release on Thursday. Market forecasts point to a 0.3% monthly increase and a 4.7% annual rate. Trading will also be influenced by month-end cash flows and the rollover of currency hedges following the expiry of a PEN 200 million foreign-exchange sell swap.