The recent increase in the value of the Costa Rican colon versus the dollar is worrisome, not only because there are no clear reasons to explain it, but also because it would be hard to contain it without causing greater problems.
In the past weeks, and without apparent reason, the price of the U.S. dollar in Costa Rica dropped considerably.
Last week we surveyed some financial operators as to why these movements where occurring, the general answer being: “we don’t know”.
The current crisis is still unveiling and its broader regional reach and consequences are still unknown. What is known is that the impact is undeniable.
Even though the region has not experienced an immediate effect, its important to wonder how the macroeconomic adjustment may happen in our countries.
First of all, in the last years the region has experienced an improvement in its economic fundamentals, even though the external situation has dampened it, specially when compared to the rest of Latin America. This external effects are outside the reach of internal economic policy.
Generally speaking, the country risk for central american countries stays constant during the second quarter of 2008
The evaluation, done by the the most important risk rating companies, is based on the positive results reported by the treasuries of the governments, the efficient administration of public debt, and the positive macroeconomic stability of the region.