Chile Firing on all Cylinders: Currency is the Best of All Emerging Markets

The Chilean peso had the biggest weekly gain among 25 emerging markets after the central bank increased its benchmark interest rate.

This week the peso gained 0.6%, outperforming the other 25 developing currencies tracked by Bloomberg.

In August alone the peso has appreciated 2.3% "beating all other global currencies tracked by Bloomberg" "because of faster- than-forecast economic growth and expectations of rising interest rates".

Chile's central bank raised rates by 0.5% for the third straight month and said it expects to keep increasing.

Chile is South America's fifth-largest economy and may grow 6.5% in the second half of this year and 5% overall in the whole of 2010.

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