Costa Rica's central bank blamed for surge in dollar

Costa Rica's central bank is behind the sudden increase in the dollar's value in the nation's wholesale money market, William Hayden, general manager of Banco Nacional de Costa Rica, claimed.

Tuesday, May 27, 2008

The reason for the sudden rise in the dollar had been a mystery for many. But Hayden claimed it was caused by wholesale market buying surges in which central bank operators acquire dollars every 15 minutes for supplies to state entities.

More on this topic

Slight Appreciation of the Dollar in Costa Rica

November 2012

Although traded amounts are not significant, the increase in the wholesale rate to 504 colones per dollar has altered the downtrend seen in recent months.

From the blog Pulso Bursátil in Aldesa:

Negotiations in MONEX wholesale currency markets rebounded yesterday, seeing transactions for the sale of dollars of ₡503.50 and today there have been some at prices of ₡504.40.

Costa Rica´s Choice: Low Dollar or High Inflation

November 2010

The loss of competitiveness in exports and tourism generates unemployment, but intervening in the exchange rate will generate inflation.

There seems no good solution to the problem Costa Rica has with the appreciation of its currency, which has meant a loss of competitiveness of its exports, especially agricultural, by about 5% annually over the past 4 years.

The greenback fights back in Costa Rica

May 2008

The recent tendency in the dollar's exchange rate against the Costa Rican colón represents a change that provides an incentive for inversions in the US currency.

History seems to be repeating itself. Many investors betted on a rise in the value of the colón when the exchange rate began to stick on the exchange-rate system's lower band.

Costa Rican colon to drop in value by year-end: analysts

May 2008

Though it may be too early to claim that the Costa Rican colon's exchange rate against the dollar has undergone a major change, analysts agree that this could be the beginning of a new tendency in the market that will lead to a depreciation in the currency's value by the end of the year.

Roy González, the central bank manager, said speculation was behind recent changes in the value of the colon.

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