After a price drop that lasted almost three weeks, euros and dollars dawn this Wednesday with surprising signs of recovery in the informal market in Cuba.
The dollar makes a big comeback, as at seven in the morning (Cuban local time) on this June 5, the US currency is valued on average at 300 pesos, 20 units more than the previous day.
The recovery also reaches the euro, the European currency rises by 10 pesos and goes from 295 to 305 CUP.
In the case of the Freely Convertible Currency (MLC), for the third consecutive day, it remains at 260 CUP.
Following an unprecedented decline, initiated by the dollar on May 16 and marked above all by the dizzying pace at which currencies fell in the last two weeks, the informal market confirms today a first and strong signal of recovery.
The currencies only granted a day of pause in the fall when none of the three currencies went up or down in price on June 4th.
The dollar dropped by 115 pesos in 19 days, in some cases falling by 10 and up to 20 pesos in a single day. The euro experienced a similar movement, dropping from 402.50 to 295 CUP in just two weeks.
Faced with the reality that this Wednesday the dollar rises by 20 pesos and the euro by 10, the questions that come to mind are:
Will they climb back up at the same speed they went down?
Will foreign currencies surpass the record prices they reached in the informal market in Cuba?
Exchange rate today 04/06/2024 - 7:00 a.m. in Cuba:
Exchange rate of USD to CUP according to elTOQUE: 300 CUP.
Exchange rate of the euro EUR to CUP according to elTOQUE: 305 CUP.
Exchange rate from MLC to CUP according to elTOQUE: 260 CUP.
Alternative exchange rate from other platforms:
Dollar exchange rate (USD): Purchase 289 CUP, Sale 302 CUP.
Exchange rate of the Euro (EUR): Buying 300 CUP, Selling 316 CUP.
Exchange rate of the MLC: Buying 257 CUP, Selling 262 CUP.
The informal exchange rate of Cuba offered here is not officially recognized or endorsed by any financial or governmental entity.
Equivalents of each available euro and US dollar bill to Cuban pesos (CUP).
United States Dollar (USD) to Cuban Peso (CUP), according to the exchange rates for this Wednesday, June 5th.
1 USD = 300 CUP.
5 USD = 1,500 CUP.
10 USD = 3,000 CUP.
20 USD = 6,000 CUP.
50 USD = 15,000 CUP.
100 USD = 30,000 CUP.
Euros (EUR) to Cuban Pesos (CUP)
1 EUR = 305 CUP.
5 EUR = 1,525 CUP.
10 EUR = 3,050 CUP.
20 EUR = 6,100 CUP.
50 EUR = 15,250 CUP.
100 EUR = 30,500 CUP.
In an extensive article published on May 21 by elToque, an independent media outlet that has been documenting the ups and downs of currency prices in the informal Cuban market since 2019, they gave their opinion on the sharp drop in the value of dollars, euros, and MLC.
The economist Pavel Vidal Alejandro first indicated that the announcement of the reinstatement of remittance services to the island through Western Union (on May 9) and the proximity to a fixed value (400 CUP x 1 USD) could have influenced expectations, the so-called market sentiment.
The economist pointed out that a "new balance had been formed in the consensus and attitude of market participants." In other words, "an increasing number of people started to consider that the price of currencies was excessively high and opted to sell before a possible drop," which triggered supply.
On the other hand, the mentioned media pointed out that it is natural for "temporary corrections to occur after an extended bullish period in the market."
He explained that since 2022, there have been six pronounced and consecutive falls in the values of the currencies that have lasted in some cases for weeks, but then they have recovered.
In any case, Vidal Alejandro considered that the fundamental factors explaining the internal and external imbalances of the Cuban economy had not changed, and therefore the temporary drop in foreign currency should not be interpreted as a true revaluation of the Cuban peso.
What do you think?
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