The dollar in Peru falls to S/3.68: Why is this unexpected decline?

The dollar exchange rate in Peru began the day with a new fall, located at S/3,6885 according to Bloomberg. Similarly, the currency closed yesterday with a new decrease, reaching S/3,6950 a level that was not planned in the economic projections of the late 2024. This trend generates questions between investors and entrepreneurs who seek to understand the factors behind This movement in the exchange market.

According to the Central Reserve Bank of Peru (BCRP), this decrease is due to a combination of internal and external factors that have strengthened the Peruvian Sun against the dollar. Among them, the growth of exports, the country’s economic stability and the monetary policy of the US Federal Reserve stands out.

Factors behind the dollar drop

“Although the initial projections for 2025 did not contemplate a drop in the dollar to these levels, the current economic dynamics have exceeded expectations,” said Jonathan Torres, a market analyst in Capitaria, to the Republic.

In that sense, the specialist pointed out elements that have generated a lower demand for dollars in the country:

1. Record commercial surplus: Peru closed 2024 with a commercial surplus of US $ 24,000 million, the highest in its history. This has generated a greater currency input, reducing the pressure on the exchange rate. According to data from the Ministry of Economy and Finance (MEF), copper exports and other minerals have been key in this result.
2. Stable monetary policy: The BCRP has maintained a policy of interest rates aligned with inflation control, which closed in 2.1% in 2024, the lowest in the region. This has promoted the trust of investors and strengthened local currency.
3. Foreign investment flow: Political and economic stability has made the Peruvian sun an attractive currency in the region. “We are seeing an increase in the demand for soles in neighboring markets such as Bolivia and Brazil, which is also contributing to its strengthening,” Torres added
4. Impact of the US Federal Reserve: The recent decision of the Fed to maintain its interest rate by 4.5% has reduced the attractiveness of the dollar in emerging markets, benefiting coins such as the Peruvian sun.

This decrease in the dollar has rethink those planned at the end of 2024, the BCR in its latest weekly report stated that the dollar would have a lower increase in 2025 and 2026. Therefore, the projections for the exchange rate have been adjusted to the decline, estimating Now that by the beginning of 2026 the dollar will reach S/3.76 instead of the S/3.85 initially planned. In the case of banks, they have also corrected their estimate by 2025, reducing from S/3.80 to S/3.78 per dollar and leaving the estimate of S/3.80 by 2026.

Monitor the dollar

Torres ended up explaining that, although the fall of the dollar has been more pronounced than expected, it is essential to monitor market behavior in the coming months.

“The Peruvian sun has shown a remarkable strength thanks to solid structural factors, but there are still external variables that can generate volatility, such as possible adjustments in the monetary policy of the Federal Reserve or changes in the global demand of raw materials,” Torres warned.

In addition, he stressed that investors should consider exchange coverage strategies to any eventuality, since the foreign exchange market remains highly sensitive to economic and political events both locally and internationally.