Pressure on Costa Rican money markets lifts the dollar

As pressure build up on Costa Rica's money markets, the only way seems to be up for the US dollar.

Friday, June 13, 2008

The nation's current account balance is showing a large deficit, and flows of investment – both financial and direct – are down. "There's a combination of factors behind the rise in the dollar's exchange rate," said Andrés Víquez, manager of the Aldesa brokerage.

More on this topic

Costa Rica: Dollar Price Continues to Rise

May 2017

So far in May the average price of the dollar in the wholesale Monex market has increased by 2%, going from ₡566/US$ on May 1st to ₡578/US$ on the 17th.  

On May 17, in the Monex wholesale market, the average price of a dollar was quoted at ₡578 per dollar, while at bank windows the selling price reached ₡582. [GRAFICA caption="Clic para interactuar con la gráfica"]

Dollar in Costa Rica: Changes in Wholesale Market

February 2017

In order to avoid sharp fluctuations in the exchange rate, the Central Bank has changed the way large participants, such as banks, participate in the Monex market daily auctions.

The objective of the monetary authority is to avoid sharp fluctuations in the price of the dollar against the Colon in the exchange market, and to have better price formation. 

Costa Rica: Loans in Dollars Get More Expensive

May 2015

Arguing an attempt to control credit growth in dollars, the Central Bank will apply a reserve limit of 15% to banks that receive lines of foreign funding in that currency.

The banking sector has opposed the measure, asserting that it will result in an increase in the cost of credit in dollars, affecting the business sector, especially exporters and importers who normally resort to credit lines in dollars to finance their operations abroad.

Costa Rica Launches Battle Against Speculative Funds

January 2013

A bill is being prepared to impose taxes on money which enters the country seeking to exploit the gap between interest rates in local currency and in dollars.

Furthermore President Chinchilla has issued a directive to state banks to stop competing with each other to attract investments from large institutions, such as the Instituto Costarricense de Electricidad, the Social Security Department, or the National Insurance Institute. It also requires public institutions to make new investments exclusively in state banks.

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