Colombian Peso Declines as Government Delays Sale of Isagen

Posted on Aug 13 2014 - 2:01pm by Rico

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COLOMBIA NEWS (Bloomberg) – Colombia’s peso fell, the second-worst decline today among emerging-market currencies, after the government delayed a sale of a stake in hydropower producer Isagen SA and cut expectations of investment inflows.

The Colombian currency dropped 0.3 percent to 1,881.05 per dollar at the close in Bogota. The price on the nation’s benchmark peso bonds fell 0.04 centavo to 123.52 centavos per peso, according to data from the central bank. Yields rose one basis point, or 0.01 percentage point, to 6.69 percent.

Finance Minister Mauricio Cardenas said yesterday the government would wait as long as a year to auction a 57.6 percent stake in Isagen, which Colombia hoped would fetch at least 5 trillion pesos ($2.7 billion) to help fund new roads. Companies including GDF Suez and China Huadian Corp. had expressed interest in buying the stake in the operator of the nation’s biggest hydropower plant.

“Investors had priced in at least part of those flows,” Juan Pablo Espinosa, head analyst at Bancolombia SA, the country’s biggest bank, said in a phone interview from Bogota. “Clearly we’re seeing a reaction to the delay and the uncertainty that it brings in terms of government financing.”

Source: Bloomberg