Dollar has more value vs Colombian Peso

[Elexpatriado]

No I havent been there yet. We plan to go some where more remote in January. Theoretically trie and clmb Simon Bolivar and Pico Cristobol Colon.
 
Well a least most of the Colombianas I have met have interst in travelling..espescialy if I foot the bill.ja.aj
 
No,actually seriously, I have met a few interested in travelling, and have done so independently.
 

Have you ever done the four or five day trip to La Ciudad Perdida? I did it with a couple of my kids and I might have been the oldest person I saw the entire time. Almost no Colombians do the trip - it's all Europeans, Aussies, Kiwis and North Americans. This lack of interest corresponds to my wife's family visiting - they have no interest in anything other than shopping. Which is kind of a shame - when you see that huge Colombian flag draped across the side of a cliff behind the army's base camp above The Lost City, it's hard not imagine a sense of pride.

[fathertime]

Peso is still going slightly lower...at the moment it is at 3336-1.  The long anticipated federal funds rate hike finally happened today.  Oil remains very low in price and the forecast is it for to remain there for a while.  Between rate hikes and low oil, it does make sense that the peso remains relatively low for a while.  If Colombian housing prices were to tank, that would be the holy grail for an American with dollars to invest or spend.


Fathertime!

[Alabamaboy!]

Peso is still going slightly lower...at the moment it is at 3336-1.  The long anticipated federal funds rate hike finally happened today.  Oil remains very low in price and the forecast is it for to remain there for a while.  Between rate hikes and low oil, it does make sense that the peso remains relatively low for a while.  If Colombian housing prices were to tank, that would be the holy grail for an American with dollars to invest or spend.


Fathertime!

For once I will be getting a good exchange rate during one of my trips there. Thank God because I was not thinking when I came up with the idea of taking the whole family to Rodadero for a week in the "Ultra High" season. The prices for hotels and apartments are jacked at that time and I am sure there will be additional price gouging with transportation, food,  and everything else. But it should be a great time.

Yeah FT we are keeping our eyes on the real estate prices as well. But they never seem to budge in a downward direction. They have been going up since I started going there, that is for sure. At one time I was thinking about buying a condo in Barrio "Recreo". It was 3 BR/2Bath. Nice tiled floors, small balcony, regular Colombian style place. Maybe 1,000 square feet or so. It was around $21K USD I believe. I did not get it and then later on when looking again, the prices had pretty much doubled for a place like that.

[vikingo]

Alabama, a place like you desribed in Recreo will cost you three times that now.
Colombia real estate has been in a bubble for years. The bubble may burst some day,
maybe when the dollar is worth 5000 pesos, who knows when.

[Alabamaboy!]

Someone told me that people don't really drop the prices that much most of the time because HOA and taxes are so small that they will just let them sit or rent them out until they sell at whatever price they are asking. That most are already paid off.

[fathertime]

Dollar hasn't moved very much vs the peso in the last few weeks...it stands at 3247-1 vs the Colombian peso.  Given the oil price has continued to drop significantly I would have thought the ratio could be at the highest  level.
Fathertime!

[buencamino2]

The Banco de la Republica is manipulating rates to the extent that it can so that the full brunt of world trading doesn't impact the country. Those of us who live here have been observing this closely. The rate they post the next day is often well off the closing figure posted say by Bloomburg the day before.

[vikingo]

Banco República says 3294 and Bloomberg closed at 3301, a difference of 7 pesos.
I believe Bloomberg's rate is for folks who exchange large amounts like millions. Not sure though.
I'm with Bancolombia and if I need to transfer larger amounts from the US I have to call the bank and negotiate a rate with them, but the rate they give you depends on the amount you want to transfer.

[fathertime]

The peso is soaring straight into a cavern today.  Fresh highwater for the dollar. It has gone as high as 3376-1.   Expats doing great so long as inflation isn't too bad.

Fathertime! 

[fathertime]

New highwater today!  3399-1.  Travelers with dollars paradise. 


Fathertime!

[AndyLee]

New highwater today!  3399-1.  Travelers with dollars paradise. 


Fathertime!

ah, no, you must have missed it, high-water mark was two days ago at 3408 on xe.com. jajajajaja, it is possible the freaking benchmark will hit 3500 in the next few days. I´m socking pesos in my mattress for chrissake. 

[AndyLee]

Peaked at 3410 at noon today. Still hoping it will break 3500 this week. I dread to think of it eventually going back to normal though, at around 2000. With the inflation that is going on right now it will be tough at 2000.

[fathertime]

Peaked at 3410 at noon today. Still hoping it will break 3500 this week. I dread to think of it eventually going back to normal though, at around 2000. With the inflation that is going on right now it will be tough at 2000.

Hey Andy,


I didn't realize the inflation was becoming a big factor.  I recall asking, but from what I gathered at that time, people didn't think it was too significant.  On what items in particular are you noticing inflation?  I'm also curious if service rates have also gone up, for example, getting a massage, private tutor, or doctor visit.   
Yeah, if the exchange rate plummets back to what was normal, and the prices remain inflated, that would really suck.  That may not happen anytime soon though, hopefully not. 


Thanks,
Fathertime!   

[AndyLee]

Hey Andy,
I didn't realize the inflation was becoming a big factor.  I recall asking, but from what I gathered at that time, people didn't think it was too significant.  On what items in particular are you noticing inflation?  I'm also curious if service rates have also gone up, for example, getting a massage, private tutor, or doctor visit.   
Yeah, if the exchange rate plummets back to what was normal, and the prices remain inflated, that would really suck.  That may not happen anytime soon though, hopefully not. 
Thanks,
Fathertime!

Officially the inflation rate for 2015 was almost 7% and the increase in the minimum wage was also 7%. Ostensibly the one would accommodate the other. But in reality some costs seem to be escalating faster than 7%.
Housing rentals for example are higher this month than when I was looking last year. Apartments that used to rent for 350,000 are now 500,000 in just one year. Hotels have doubled or more since I´ve been here. Five years ago in the pueblos it was common to be able to rent a room with hot shower for 30,000. Now 60,000 is more likely. Hotels in the cities of course are even more expensive.
Part of this is attributable to the customary annual increase. The last week of December and first week of January it is customary to raise prices almost automatically. At my local waterhole for example the local beer went from 2200 to 2500 overnight. That´s 9% increase.
Food is up, too, especially packaged foods, and especially imported products of all kinds. I remember two years ago we were eagerly awaiting the decrease in prices promised by the new TLC free trade agreement. Hah! Never happened.
Still, it´s a decently strong economy compared to most of the other Latin American countries, especially Venezuela and Brazil.

[buencamino2]

One of the most important sources of income of the Colombian government are the regalías paid by the petroleum industry. The government established it's fiscal plans for 2016 based on an expected barrel price of seventy dollars or so. That turned out to be way off the mark. The income from regalías is now expected to be 30% to 40% below what the government planned on. Add this to the high dollar and it means a lot of belt tightening. It will be ongoing and some of the effects won't be felt until 2017. A bit of good news for citizens is that Santos has decided against a proposed in crease in the IVA of 19%.

[Elexpatriado]

You just have to be flexible. I quit going to restaurants where they increase the price too much. Havent had a rent increase yet, although I have been threatened. My Landlord is a Gringo, and knows a good client when he sees one, so hsnt yet gotten greedy like a Colombiano. Most of his other suites sit empty at least 50% of the time.
Still way cheaper than living in Canada, and I am not sure the inflation rate is lowere here. At least they dont implement goofy social-engineering programs, like Carbon Taxes and the like, like they are doing in Canada now.

[benjio]

My Landlord is a Gringo, and knows a good client when he sees one, so hsnt yet gotten greedy like a Colombiano. Most of his other suites sit empty at least 50% of the time.

Good point. Unfortunately I was already locked into a lease when I started to meet all the gringos here in Rio that rented properties. I could have saved about $500 a month for a bigger apartment closer to my office. Even now I'm renting from a gringo friend that has several apartments here in Rio he can't get rid of. My girlfriends father offered me a place for free but I've never felt appropriate taking his handouts. If I ever marry his daughter the bill for the wedding he's going to pick up will be more than enough!!! 


There is a standard rent increase here of about 15% a year which is to be expected. My Brazilian Landlord (a very grumpy, mean, old cat lady) tried to increase on me twice....once for 17.5%. Each time she tried I threatened to move out (and I was dead serious) and she withdrew the rent increase proposals. She knew very well with the way things are going here in Brazil that she wasn't going to be able to find someone else to pay what was at the time, the equivalent of $3500 per month. Not to mention I was very quiet, clean and traveling for work half the time. She specialized in luxury properties so only 2 of her 10 apartments had permanent tenants while I was living here. I'm certain she misses me at some level now. I'm pretty sure the rent I paid was a significant part of her retirement income.


I just left Barranquilla last week and I didn't notice any significant price increases from the year before. At least not any that aren't a direct result of Carnival being so close. From the airport to Zona Norte I usually pay between 25,000 and 30,000 COP. When I arrived and took a taxi from the airport to the hotel he charged me 40.000. I knew he was trying to get over but the exchange rate is so much in my favor I wasn't going to argue over $3.00 USD. Even the guy at the front desk confirmed that from the airport to that hotel shouldn't ever cost more than $30,000 COP. I was tried from the trip anyway though. 

[fathertime]

You just have to be flexible. I quit going to restaurants where they increase the price too much. Havent had a rent increase yet, although I have been threatened. My Landlord is a Gringo, and knows a good client when he sees one, so hsnt yet gotten greedy like a Colombiano. Most of his other suites sit empty at least 50% of the time.
Still way cheaper than living in Canada, and I am not sure the inflation rate is lowere here. At least they dont implement goofy social-engineering programs, like Carbon Taxes and the like, like they are doing in Canada now.

Hey Expat,


I noticed that the Canadian Dollar hasn't moved very much against the Colombian Peso.  Given that, inflation in Colombia would be more impactful for a Canadian I suppose.   


Fathertime! 

[Elexpatriado]

Yes its more of an impact. Not to mention the TSX  has been doing way Worse  than the DJIA, and a lot of my oil stocks have cut dividends and even one went bankrupt. (though I am quite diversified, even more so now LOL)
Still, $Can has been doing okay compared to the Peso..was 1900 before the crash today is 2400, so thats a 26% increase.
The expensive part is going back to Canada or travelling to places like Argentina.
Anyway, things always balance out in the long run, just need discipline to wait it out.
 

Hey Expat,


I noticed that the Canadian Dollar hasn't moved very much against the Colombian Peso.  Given that, inflation in Colombia would be more impactful for a Canadian I suppose.   


Fathertime!

[fathertime]

The US markets are closed today, but if the number I'm reading is accurate, the dollar has reached new highwater marks...at over 3450-1.  Boy, Buencamino, AndyLee, Viking, and the gang of expats must be dancing in the street!






NEWS & INFO
Headlines
 
USD/COP (COP=X) -CCY   In Watchlist
3,453.8999 Up 72.9299(2.1600%) 11:23AM EST

[AndyLee]

The US markets are closed today, but if the number I'm reading is accurate, the dollar has reached new highwater marks...at over 3450-1.  Boy, Buencamino, AndyLee, Viking, and the gang of expats must be dancing in the street!






NEWS & INFO
Headlines
 
USD/COP (COP=X) -CCY   In Watchlist
3,453.8999 Up 72.9299(2.1600%) 11:23AM EST

hehehehehe my mattress was bulging, so I went down to Price Smart (similar Costco) and bought one of their hotel safes for 179,000. It has  a combo lock and a key lock like the hotels safes you see here in Latin American. You can bolt it to the floor in four places and it is (supposedly) fireproof. and I hope mold proof. My income has soared by about 100% this past year.....funny, considering there was no cost of living allowance increase this year in US Social Security. My teaching salary has diminished accordingly, but who cares, I teach as much for the fun factor as for the extra income.
Still, I feel bad for the folks who only have an income in COPs. they are really feeling the pinch as the cost of living goes up all around.

[buencamino2]

The US markets are closed today, but if the number I'm reading is accurate, the dollar has reached new highwater marks...at over 3450-1.  Boy, Buencamino, AndyLee, Viking, and the gang of expats must be dancing in the street!

Yes. Life is good!

[vikingo]

Those of us who live in Colombia on US dollars could be in for a rude awakening should the price of oil increase again. Unfortunately low gasoline prices hinder development and sales of electric and especially hybrid cars, the only sure way to keep oil prices where they are now.

[robert angel]

Those of us who live in Colombia on US dollars could be in for a rude awakening should the price of oil increase again. Unfortunately low gasoline prices hinder development and sales of electric and especially hybrid cars, the only sure way to keep oil prices where they are now.

Oil will inevitably go back up, but probably not near to what it was, at least for a good number of years. Electric and hybrid cars represent a very, very small portion of cars sold not just in the USA, but globally. This is expected to continue until at least 2040. In the USA, if they did experience a major shift to electric vehicles, they would have to devise new methods to collect tax monies typically derived from taxes on gas and oil, which are supposed to fund not just construction of highways, roads and bridges, but to repair and maintain them, an issue that alone would cost well over a trillion dollars.

It sounds far fetched now, but vehicles that drive themselves, including 18 wheeler huge trucks, will be much more common before electric and hybrid cars are. Audi and Tesla have made major developments in that realm already, and other manufacturers are folllowing suit. It says something about consumer's concerns about gasoline, oil and vehicle sales that for 39 years in a row, the big Ford F150 truck
that gets MPG in the low teens, has been the number one selling of all vehicles, including Accords, Camrys, Malibus, etc.

[Elexpatriado]

Your first paragraph below is spot on.world Oil consumption is not even forecastvto.peak until at least 2030.We are using a millón barrels a DAY.more every year.low prices just make it worse

I have noted lately that peso has decoupled from oil prices.Even with slight rise it goes down, at least compared to Can $.which means Colombia has other deeper issues

Oil will inevitably go back up, but probably not near to what it was, at least for a good number of years. Electric and hybrid cars represent a very, very small portion of cars sold not just in the USA, but globally. This is expected to continue until at least 2040. In the USA, if they did experience a major shift to electric vehicles, they would have to devise new methods to collect tax monies typically derived from taxes on gas and oil, which are supposed to fund not just construction of highways, roads and bridges, but to repair and maintain them, an issue that alone would cost well over a trillion dollars.

It sounds far fetched now, but vehicles that drive themselves, including 18 wheeler huge trucks, will be much more common before electric and hybrid cars are. Audi and Tesla have made major developments in that realm already, and other manufacturers are folllowing suit. It says something about consumer's concerns about gasoline, oil and vehicle sales that for 39 years in a row, the big Ford F150 truck
that gets MPG in the low teens, has been the number one selling of all vehicles, including Accords, Camrys, Malibus, etc.