LatinNews Daily - 26 February 2020

* The Chilean peso traded at Cl$807.9/US$1 at the end of trading on 25 February, appreciating just 0.27% after depreciating against the US dollar for three consecutive days to reach a low of Cl$808/US$1 on 24 February. The sharp deprecation of the peso has been linked to fears that Chile’s economy will be heavily affected by the outbreak of the coronavirus (Covid-19) in China. The Asian country is Chile’s main trading partner and principal consumer of copper, Chile’s main export and source of foreign reserves. There has been a significant fall in demand for copper in China as a result of the emergency measures adopted by the Chinese government to try to contain the outbreak. This has led the price of copper in international markets to fall by 9.4% to US$2.56 per pound this week since confirmation of the outbreak on 20 January. It has also resulted in investors turning away from Chilean assets with some US$753m being withdrawn from Chilean financial markets last week, taking the total amount of capital withdrawn this year to some US$4.1bn.     

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