American financial services firm JP Morgan announced this week that they plan to add more Colombian debt to two investment indexes popular with emerging market investors.
The firm said on Wednesday that by September they plan to raise the weighting of Colombian debt in the indexes to be on a par with developing economies such as Turkey and Thailand.
The Colombian peso hit a nine week high after the news, rising 4% in eight days to $1,968 COP to the dollar.
This change comes after a 6% drop in the value of the peso between January and early March.
But the sudden increase in value has caused some local investors concern.
Colombia’s central bank announced on Friday that they will continue to intervene in the foreign exchange market to prevent further peso gains and boost foreign reserves.
The central bank have been buying dollars for two years, helping to keep the peso weak and boost exports.
Colombian Finance Minister, Mauricio Cadenas, also told investment publication Emerging Markets last week that the country is planning a $25 billion USD investment programme in the coming months.
The Minister said more than $8 billion USD would be focused on roadway projects in April, and two other packages are set to be offered between the second half of the year and 2015, requiring similar levels of investment.
Colombia is currently Latin America’s third strongest economy according to some analysts.
The country is rated BBB by Standard and Poor’s and Fitch, and BAA3 by Moody’s.