Friday, December 31, 2010

Chilean Peso As A Copper Currency

In April 2009, I pointed to the close relationship between the Chilean peso and the price of Copper, Chile's main export good .

Well, now we can read about how the price of copper reaches new highs. And not coincidentally, so does the Chilean peso.
We shouldn't expect a perfect relationship because there are other factors involved, but that there is a strong empirical and causal relationship should be clear.