Latin American currencies depreciate against U.S. dollar in 2014

Latin American and Caribbean currencies weakened overall against the U.S. dollar in 2014, according to a new report by the Economic Commission for Latin American and the Caribbean (ECLAC).

According to the ECLAC, contributing factors to this depression included the withdrawal or slowing down of stimulus programs, the fall in prices of basic goods, the lower availability of capital on international markets, and the overall regional economic slowdown.

In its annual study released on Wednesday, the ECLAC said that "lower interest rates, as a result of a relaxing of monetary policies, contributed to the fact that, in 2014, the currencies of 15 countries depreciated against the U.S. dollar."

Furthermore, this fall was more evident in countries that are more highly integrated into international capital markets, such as Argentina and Venezuela.

"South America saw a depreciation of 2.3 percent compared to the rest of the world, while other regions combined (Central America, Mexico and the Caribbean) saw a fall of 0.1 percent. This shows that the overall evolution hides differences between countries," the ECLAC specified.

Furthermore, the effective exchange rate in countries like Bolivia, Trinidad and Tobago and Ecuador saw a higher rate of appreciation than others, due to less changes in the foreign trade, savings rates, or the fiscal policy.

The appreciation of the exchange rate reached 6.5 percent in Bolivia, 5 percent in Trinidad and Tobago and 3.2 percent in Ecuador.

Alongside this, the region's foreign reserves increased by 3.3 percent last year, returning to the track of growth after a contraction was reported in 2013.

Foreign reserves grew in 25 economies, particularly Panama (43.9 percent), Jamaica (36.1 percent), and Belize (19.8 percent).

The biggest falls in foreign reserves were recorded in Haiti (-33.4 percent), Suriname (-19.7 percent) and Guyana (-14.3 percent).

However, in the five countries with the most foreign reserves, the increase was far smaller at just 2.9 percent on average.

Mexico's reserves grew most among the five with a figure of 8.6 percent, followed by Colombia (8.5 percent) and Brazil (1.3 percent). Chile's reserves dropped fractionally by 1.6 percent and Peru lost 5.1 percent of its reserves.

The ECLAC's comprehensive report also predicted that the entire Latin America and Caribbean region would see a GDP growth of only 0.5 percent in 2015. Endi