The Colombian peso recently broke the COP$4,000 mark against the U.S. dollar for the first time in 2024, reaching a high of COP$4,049. Experts attribute this to government budget cuts and a fiscal deficit exceeding COP$25 trillion.

Finance Minister Ricardo Bonilla announced a significant COP$20 trillion cut in the national budget, urging a 5.6% reduction from all departments. The decline in global oil prices has also affected Colombia’s foreign exchange earnings, adding to economic pressures.

The upcoming U.S. Federal Reserve meeting and decisions on interest rates are contributing to financial uncertainty impacting the peso. Director of Fedesarrollo, Luis Fernando Mejía, links the peso’s depreciation to falling Brent crude prices and fiscal challenges.

This situation highlights the importance of economic management and planning to address local and global financial conditions, crucial for Colombia’s trade, investment, and economic strategy moving forward.