Warning of a Possible Fall in the Dollar Price

In Costa Rica, exporters ask the Central Bank to "avoid distortions in the fixing of the exchange rate because of the oversupply of dollars from the sources of financing for the fiscal deficit."

Tuesday, June 11, 2019

At the end of 2018 and the beginning of 2019, the dollar price against the Colon reported an upward trend, but from February 6 to mid-June 11, there has been a fall of up to 26 colones per dollar.

See "Dollar Price Keeps Down

In addition to the downward trend registered in the first half of this year, there is the possibility that many dollars may enter the economy during the second half of the year, as a result of the subscription of loans with international entities and the issuance of Eurobonds prepared by the Alvarado administration.

Elobservador.com reports that ".... Possible sudden or exaggerated decreases in the exchange rate of the dollar cause fear for the export sector, whose income is determined in this currency. Faced with the possibility of a high income of foreign exchange in the second half of 2019 - for the loans subscribed by the Ministry of Finance ($850 million) and the issuance of Eurobonds ($1.5 billion) - the export sector asked the Central Bank to reiterate "its commitment" to avoid distortions in the fixing of the exchange rate against the expected oversupply.”

Also see "Costa Rican Government Keeps Going into Debt" and “$1.5 Billion in Eurobonds Approved”.

In this regard, the business organizations Cadexco, Canapep, Canaba, Canapems and the Chamber of Coffee Exporters, made a statement in which they asked the Central Bank "... to avoid distortions in the fixation of the exchange rate for the oversupply of dollars coming from the sources of financing of the fiscal deficit, as long as the government decides to convert those dollars to colones."

See negotiation data in MONEX and exchange rates at the window.

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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.

Concern over Dollar Price Decline

July 2019

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.

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.

Dollar Price Keeps Going Down

June 2019

A greater supply of dollars, high local interest rates and a decrease in imports of durable goods explain the decreasing trend of the exchange rate in Costa Rica, which on June 18 reached the lowest level of the year.

In 2018, the dollar price against the Colon was on an upward trend, however, between February 6 and mid-June of this year, there has been a fall of up to 28 colones per dollar.

Exchange Rate Resumes Upward Trend

January 2019

In Costa Rica, in the first half of the month, the exchange rate of the dollar with respect to the colon recorded a downward trend, however, from January 16 to 24 it increased almost 9 colones per dollar.

After the average exchange rate against the dollar in the wholesale market fell from ¢610.7 to ¢600.3 between January 8 and January 16, Monex has registered continuous increases in the last few days, rising to ¢609 on January 24.

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