The greenback fights back in Costa Rica

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.

Tuesday, May 20, 2008

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. Now, with the strengthening of the dollar they are seeking to get back into dollar investments.

More on this topic

5% jump in Costa Rica's currency raises eyebrows

July 2008

The tumble of 5 percent in Costa Rica's exchange rate in a single day has caused some observers to question the model of maintaining an exchange rate range, says Melizandro Quirós in a column in the web site Nacion.com.

Under this system, the external shocks are absorbed by the exchange rate, says Quirós.

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 price of the US dollar in Costa Rica

January 2009

After in the increase in the growth rate of the ceiling of the exchange band, the reference exchange rate continues to be close to the ceiling.

Nacion.com reports: "The weighted average price (considering the amount traded at each exchange rate) of the wholesale market (Monex) at the end of the day was at 562.28 colones per dollar, very close to the ceiling of the band, which was at ¢563,65 yesterday."

Costa Rica Central Bank Forced to Buy Dollars

December 2010

The Central Bank of Costa Rica (BCCR) reported the acquisition of $ 7.5 million to defend the lower limit of the band system governing the exchange rate.

The BCCR´s intervention on the foreign exchange market increased liquidity in Colones, which in principle, and given current conditions of the monetary system, it did not have the usual inflationary effect.

 close (x)

Receive more news about Central Banking

Suscribe FOR FREE to CentralAmericaDATA EXPRESS.
The most important news of Central America, every day.

Type in your e-mail address:

* Al suscribirse, estará aceptando los terminos y condiciones


New house for sale at Costa Rica beach in Punta Leona Resort

Live at the beach in the exclusive Punta Leona Resort, a dream with shaded white sand beach, pools, restaurants, wild life. New affordable, energy efficient home.
The house - possibly the only energy efficient GREEN...

Stock Indexes

(Dec 9)
Dow Jones
0.72%
S&P 500
0.59%
Nasdaq
0.50%

Commodities

(Dec 9)
Brent Crude Oil
55.06
Coffee "C"
139.35
Gold
1,160
Silver
16.900