Chile: The dollar falls by over $15 and approaches $950 as copper surpasses $4.5 per pound.

The price of the red metal, main export of Chile, is trading at new highs of almost two years and is on track for its best week in 15 months.

On Friday, the dollar fell to levels around $950, mainly due to the extended surge in copper to new highs since mid-2022, and as tensions in the Middle East eased following Israel’s first direct attack on Iran, which did not lead to expectations of further retaliation.

The currency dropped by $15.8 to $951 before noon in Chile, marking its lowest levels of the day and pointing to a third consecutive session decline in the Bloomberg series, after also falling by more than $10 the previous day.

This coincides with a favorable external environment for the Chilean peso: Comex copper rose by 1.1% to $4.51 per pound, trading at new highs of almost two years and on track for its best week in 15 months. The dollar index edged down by 0.15% to 106 points, and market rates remained stable in the United States.

Copper has steadily risen over the past two months, driven by optimism about global growth and demand, as well as mining supply cuts for 2024, which have increasingly tightened market conditions.

The copper price increases are attributed to stimuli from the People’s Bank of China, coupled with strong corporate earnings from chip developers.

Turning to the Middle East, the headline news is that Israel launched its first-ever attack on Iranian soil last night. This initially spurred demand for safe-haven assets but has mostly reversed since then.