Colombia’s Peso Surge And Stock Rally Test The Limits Of Risk Appetite

Key Points

• The peso strengthened to about 3,649.7 per dollar as the market extended a multi-month downtrend in USD/COP.
• Colombian equities hit fresh records, with the MSCI COLCAP closing at 2,236.51, up 1.05%.
• Momentum is extreme on both fronts: USD/COP looks stretched to the downside, while the COLCAP looks overheated.

Colombia opened Wednesday with the peso still on the front foot and stocks still pushing into record territory, even as global investors weighed a steady dollar index near 99.15–99.18, US inflation data broadly in line with expectations, and renewed political pressure around Federal Reserve independence.

On Tuesday, the local FX market drove USD/COP sharply lower. Local reporting put the session’s average around 3,663.28 versus an official TRM near 3,717.09, with a 3,626.55 low and a 3,715 high.

Turnover was heavy at roughly $1.531 billion across 1,742 transactions. Another local account described an opening near 3,705 and a close around 3,634, underscoring how quickly the market moved below 3,700.

The fundamental mix remained supportive for COP. Brent crude rose about $1.06 to $64.93, a mild tailwind for an oil-linked currency.

Colombia’s central bank has kept its policy rate at 9.25%, preserving the yield cushion that attracts carry strategies when US rates drift lower.

Still, fiscal politics hangs over the outlook. Ratings commentary has warned that meaningful fiscal adjustment is unlikely in the first half of 2026 amid the election calendar, a backdrop that can amplify volatility if risk sentiment flips.

Technically, USD/COP looks extended. Your charts show depressed momentum readings, with RSI around the low-to-mid 30s on 4-hour, daily, and weekly views, while MACD remains negative.

Support sits near 3,650 and 3,640–3,636, with rebounds likely to meet resistance around 3,667–3,681 and 3,700–3,730.

Stocks, meanwhile, are running hot. The MSCI COLCAP closed at 2,236.51, another all-time high, with Ecopetrol the most traded name at roughly COP 40.43 billion in value.

The day’s top winners were Mineros (+4.52%), Cibest (+4.06%), Ecopetrol (+2.74%), PF Grupo Sura (+2.25%), and ICOLCAP (+2.17%). The main laggards were Terpel (-2.64%), GEB (-2.55%), BVC (-2.03%), Grupo Argos (-1.45%), and Promigas (-0.78%).

Overbought signals are flashing: COLCAP RSI sits around 80 on 4-hour and the mid-to-high 70s on daily and weekly charts, a setup that often leads to sharp pauses even in strong uptrends.

This is part of The Rio Times’ daily coverage of Colombian markets and Latin American financial news.

For context on regional markets, see Brazil’s Ibovespa for the same session.

Also tracking regional peers: Chile’s IPSA closed the same session.

Related coverage: Brazil’s Morning Call | Colombia’s Consumer Confidence Ends 2025 at a High Not Seen