Chile peso falls to 2-week low; stocks edge higher

By Aaron Nelsen

SANTIAGO, Sept 30 (Reuters) - Chile's currency fell to its lowest point in more than two weeks on Wednesday as banks stepped up purchases of U.S. dollars to roll over maturing forward currency contracts.

The peso CLP=CL also fell in line with U.S. stocks, traders said, weakening 0.3 percent to 549.30/549.80 per dollar from Tuesday's close of 547.70/548.20.

"Once again there was a high demand for dollars to roll over forward contracts coming due but at the same time markets have been mostly negative after weaker-than-expected economic data in the U.S.," said a trader who declined to be named.

The peso has strengthened 16.7 percent against the dollar so far this year after slumping 22.3 percent in 2008.

The retail, consumer and industrial sectors lifted Chile's blue-chip IPSA .IPSA stock index 0.2 percent to 3,375.49 points, Gains were led by Chilean retailer La Polar LAP.SN, up more than 2 percent to 2,478 pesos.

Construction and housing shares limited advances as investors booked profits after several days of gains, led by a 2.3 percent decline in engineering and construction firm Paz Corp PAZ.SN.

"What we're seeing today is mostly associated with movements on foreign markets," said William Baeza, a financial analyst with Euroamerica Corredores brokerage. "The companies that are showing the biggest movement don't carry much weight on the IPSA."