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Peru sol closes flat after cenbank intervention
LIMA : Peru 's central bank sold $186 million on Monday and placed 100 million soles ($36 million) as the local currenc
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LIMA: Peru's central bank sold $186 million on Monday and placed 100 million soles ($36 million) as the local currency slipped.
The sol ended up closing flat, bidding 2.77 per US dollar on the spot market.
The central bank regularly intervenes in the market because half of all deposits made in Peru are in dollars and volatility hurts businesses and consumers.
Normally it buys dollars to soak up excess liquidity. But the bank began selling dollars last week, when investors started to drop high-yielding emerging market assets on concerns of a new global recession.
Copyright Reuters, 2011
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