So far this year the Banco de Guatemala has intervened in the foreign exchange market buying $282 million, less than the $320 million bought in the same period in 2017.
As announced by the Central Bank authorities at the beginning of the year, the institution continues to implement actions to reduce the downward trend registered in the price of the local currency with respect to the Dollar.In January 2010 the Quetzal was quoted at Q8.40 for each dollar, and in January2018 this figure reached Q7.34.
U.S. currency rose last week after having been at its lowest value for the last five years.
The upward trend that the dollar began showing last week against the quetzal, could continue in the coming months as it seems that factors that pushed the dollar down are no longer present in the Guatemalan economy.
One contributing factor is the inflow of foreign exchange from exports, which increased during the harvest and the months of higher coffee sales, but the coffee year is coming to an end, so the influx of dollars could start to decline in the coming months, relieving the pressure and creating a drop in the value of U.S. currency compared to the quetzal.
Yesterday exchange rate was 8,16 quetzales, the highest on record since November 2001.
Guatemala's currency lost 4.6% of its value against the dollar in the first six months of the year. This process has been smooth in the last 2 months, not requiring stabilization intervention by the Banco de Guatemala (Banguat), whose last participation in the market was in April.
The Bank of Guatemala (Banguat) intervened in the foreign exchange market to halt the devaluation of the Quetzal.
The bank placed $19.2 million at an exchange rate of Q8.08 and Q8.10; this being the first time it has intervened in the market since December 29, 2008, when it auctioned $3.5 million.
In an article in elPeriódico of Guatemala, it was reported: "For some analysts, the devaluation of the quetzal against the dollar has been driven indirectly by the Monetary Board and the Bank of Guatemala, after it decided to make the rule for participation more flexible when the average exchange rate of the previous 5 days varied from 0.5% to 0.75%, as well as having loosened the bank's financial reserve requirements which generated greater liquidity availability and this was channeled towards the purchase of foreign currency."