Dollar Dips in Colombia as Trump Threatens Higher Tariffs

The US dollar closed lower in Colombia on Tuesday. The currency’s decline followed President Donald Trump’s statements about imposing higher general tariffs.

Trump hinted at rates exceeding the 2.5% threshold he initially promised before taking office. The greenback ended Tuesday at 4,219 Colombian pesos (COP). This marked a decrease of 1.83 COP compared to the official exchange rate of 4,220.86 COP.

Trading saw a low of 4,195.30 COP and a high of 4,238 COP. Traders executed 2,602 operations totaling $1.491 billion. Visión Davivienda’s team noted the Colombian peso depreciated 0.48% on Monday.

Two factors drove this change. The Brent crude oil price fell, and a diplomatic crisis erupted over the weekend. Trump threatened to slap tariffs on Colombian imports during this period.

The dollar strengthened against major currencies like the euro on the global stage. Copper prices also dropped after Trump‘s latest tariff comments. The President declared his intention to enact “much higher” widespread tariffs than 2.5%.

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Trump’s Florida speech outlined plans for sector-specific tariffs. He targeted semiconductors, pharmaceuticals, steel, copper, and aluminum industries. These statements rattled markets and raised concerns about potential trade disruptions.

Oil prices saw modest gains on Tuesday. However, they remained near two-week lows. Weak Chinese economic data and rising temperatures in other countries dampened demand outlooks. Brent crude futures rose 35 cents (0.45%) to $77.43 per barrel.

China’s unexpected manufacturing contraction in January worried oil traders. As the world’s largest crude importer, China’s economic health significantly impacts global oil demand. Analysts cautioned that this data could weigh on crude prices in the near term.

Protests in Libya’s Es Sidra port disrupted oil loading operations. This supply interruption provided some support for oil prices. However, overall market sentiment remained cautious due to economic uncertainties and geopolitical tensions.