The conflict in Gaza is claiming many lives and has alerted many people around the world. Peru is no exception, which is why there has been a rise in the price of the dollar. Although both Israel and Palestine are not close to Peruvian territory, it has affected the economy and this caused a series of doubts, such as what caused it. For this reason, La República interviewed Sandra Ramón, an economist at the PUCP, who answers all questions about the exchange rate.
How does the war between Israel and Palestine affect the price of the dollar in Peru?
According to Sandra Ramón, there are two factors caused by this war that generate the rise in the price of the dollar in Peru. First, the long-term instability and mistrust regarding this conflict. Therefore, investors look for a “safe haven asset” for their money and go for the safest currency, that is, the dollar. This has caused demand for the US currency to increase, thus increasing its price. This can be seen reflected in the reference rate of the Central Reserve Bank of Peru (BCRP). So, at a lower rate, more soles are needed to buy dollars.
“This instability is affected by the magnitude of the conflict, whether it is going to expand and there will be other countries that will intervene, which is uncertain at this time,” said the PUCP economist.
On the other hand, the extent of the conflict and the effects it will have on oil reserves worldwide are not yet known. As Sandra Ramón points out, Israel is one of the oil producers, like Iran, which is one of the most important in the world. Both are countries that are related in this conflict; Well, the latter has been actively supporting the terrorist group Hamas. This has generated uncertainty in their rate as they do not know how long the rise in the price of the so-called ‘black gold’ will last or if their offer will be affected by it. This is a factor that influences the price of the dollar worldwide and Peru is no exception.
“In conclusion, I consider that the main reasons why the dollar has risen in recent days with respect to the War in Israel is because of the uncertainty that it generates, whether in magnitude, time and effects, which makes the investors take refuge in safe assets like the dollar,” concluded the economist.
Source: Larepublica
Alia is a professional author and journalist, working at 247 news agency. She writes on various topics from economy news to general interest pieces, providing readers with relevant and informative content. With years of experience, she brings a unique perspective and in-depth analysis to her work.
