Instruments for Intervention in the Foreign Exchange Market

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Banco de la República can intervene in the currency-exchange market through the following instruments:  
  • Intervention through the auction of options of purchase or sale of foreign currency to the Bank, to control the volatility in the exchange rate. 
  • Intervention through discretionary auctions of options of foreign currency sales to the Bank, to accumulate international reserves. 
  • Intervention through discretionary auctions of options for the purchase of foreign currency from the Bank, in order to disaccumulate international reserves. 
  • Discretionary intervention through direct purchases or sales of foreign currency in the exchange market. 
  • Intervention through competitive auctions to buy US dollars in the foreign exchange market. 
 
A more in-depth description of the instruments for intervention in the foreign exchange market can be found in the Regulatory Letter DODM-143 Asunto 5: Intervención del Banco de la República en el mercado cambiario.