Cuban Peso-U.S. Dollar exchange rate sinks to record levels

From our Bureau of Socialist Voodoo Economics with some assistance from or Bureau of Extreme Pain Caused by Exchange Rates to Noble Savages in Tropical Totalitarian Hellholes

Not good. Not good at all. Cubans living in Castrogonia are under siege from all quarters: repression, epidemics, natural disasters, shortages, etc… Add one more crisis to the list: the rapidly declining value of the Cuban peso versus the almighty U.S. Dollar, which is the most important currency in Cuba, no matter what Castro, Inc. says.

Misery. One word that encapsulates and reifies everything Cubans have experienced every hour of the day, seven days a week, for the past sixty-four years, five months, and fourteen days.

Loosely translated from Periodico de Cuba

The price of the US dollar (USD) in Cuba broke this past Monday, for the second time in history, the barrier of 200 Cuban pesos (CUP), according to the exchange rates quoted in the informal market of the Island.

According to an article by the EFE agency, which interviewed several Cuban economists, the rate could continue to increase, unlike what happened in October 2022, since now the demand for dollars is much greater than then.

Pavel Vidal, a professor at the Javeriana University of Cali (Colombia) and with work experience at the Central Bank of Cuba (BCC), told the agency that a few months ago, when the BCC announced the establishment of an official exchange rate for 1 USD for every 120 CUP, jumping from the previous ratio of 1×24, a “speculative” phenomenon was experienced in the informal market, derived from an “exchange rate overreaction” and the barrier of 200 CUP was exceeded.

However, now the problems have worsened, such as an “incomplete recovery after the pandemic, especially tourism and macroeconomic imbalances, such as the fiscal deficit.”

In addition, there is an unprecedented demand for dollars, to which private micro, small and medium-sized enterprises (Mipymes) contribute, which in order to import must buy the currency in the parallel market, since the government does not give them access to a type of preferential change.

Coupled with that, the search for dollars by people who travel abroad individually to buy products and sell them in the depressed supply of domestic goods continues. In this situation are also those who plan to emigrate permanently, either through the parole program or other categories of visas to the United States or to Spain, thanks to the nationalization process allowed by the Democratic Memory Law approved last October by Congress. of the European country.

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