Concern over Dollar Price Decline

In Costa Rica, exporters and businessmen of the tourism sector are concerned about the decreasing trend that in recent months has reported the exchange rate, which on July 18 was quoted at ¢575.7 per dollar.

Thursday, July 18, 2019

Official figures report that between early February and mid-July of this year, there has been a fall of up to 38 colones per dollar, as the average rate in the Monex wholesale market fell from ¢613.87 to ¢575.69.

This declining trend is mainly attributed to the greater supply of dollars, high local interest rates, and a decline in durable goods imports, according to explanations from specialists in the field.

Laura Bonilla, president of the Chamber of Exporters of Costa Rica (Cadexco), told Elobservador.com that they are "... extremely concerned about the trend that has had the exchange rate since December. Today, for every dollar, we are receiving ¢40 less. This makes us less competitive and hits the export sector more, maximum with the numbers down that is presenting the sector."

See “Warning of a Possible Fall in the Dollar Price

Shirley Calvo, executive director of the National Chamber of Tourism (Canatur), explained that "... Any variation in the abrupt or prolonged exchange rate, such as that experienced since February, affects the cost structure of companies and especially ours, which faced the high season with contracts that were agreed long before."

The behavior that is currently reported was predicted by the businessmen, because the export sector of the country, months ago asked the Central Bank "to avoid distortions in the fixing of the exchange rate by the oversupply of dollars from the sources of financing of the fiscal deficit.”

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More on this topic

Strong Dollar Income to Press Exchange Rate

July 2019

In Costa Rica, it is expected that the downward trend that has been showing the exchange rate since February will intensify in the coming months, when the $3.580 million begins to enter as a result of the issuance of Eurobonds and loans granted by external entities.

According to data from the Central Bank of Costa Rica (BCCR), between the beginning of February and July 30 of this year, there has been a fall of up to 44 colones per dollar, reporting a drop in the average rate in the wholesale market Monex from ¢613.87 to ¢570.13.

Guatemala: Quetzal Continues to Appreciate Against Dollar

January 2015

In order to moderate the decline in the dollar the Bank of Guatemala has made two interventions so far in 2015.

During 2013 the Guatemalan currency gained about 3% against the dollar, making exports less competitive. Due to the fact that the trend has continued, the Bank of Guatemala has started to apply the rule of exchange participation in order to moderate behavior of the currency.

Dollar in Costa Rica: Wholesale Market Participants Excluded

June 2014

In an attempt to limit exchange rate volatility, the Central Bank has determined that non-bank public companies can no longer trade currencies in the Monex wholesale market.

As explained by the entity, the foreign exchange requirements of the Non Banking Public Sector will not be served directly by the BCCR using international reserves.

Price of Dollar Goes Down in Costa Rica

June 2014

A reduced demand for dollars by the nonfinancial public sector could be the reason behind the reduction of 7.5 colones in the price of the US dollar this week.

Since the last central bank intervention in the wholesale foreign exchange market on June 10, the dollar has shown a downward trend, being quoted at ¢ 546.47 per dollar at the close of June 20.

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