The price of foreign currency in Cuba is plummeting without brakes following the recent announcement by the Cuban government to establish a more flexible official exchange rate by 2025, which will respond to market supply and demand dynamics.
In recent hours, the three benchmark currencies in the informal market have continued to decline.
At dawn on this Monday, the dollar is trading at 310 CUP, seven pesos less than the previous day.
The euro also falls, decreasing by five pesos to 320 CUP.
The value of the Convertible Currency (MLC) also dropped, now standing at 260 pesos, three units lower than this Sunday.
The regime's announcement regarding the so-called "floating exchange rate," the details and effective date of which are unknown, aims to regulate the currency market in a context where the informal foreign exchange market dominates, setting the real prices of goods consumed by the population.
Exchange rate today, 12/23/2024 - 7:47 a.m. in Cuba:
Exchange rate of the dollar USD to CUP according to elTOQUE: 310 CUP.
Exchange rate of the euro EUR to CUP according to elTOQUE: 320 CUP.
Exchange rate of MLC to CUP according to TOQUE: 260 CUP.
The strategy to control the foreign exchange market
The Cuban government announced last Wednesday that it will establish a flexible official exchange rate, adjusted to supply and demand, in an effort to compete with the informal market, which currently dominates the real value of the Cuban peso.
This measure is part of a partial dollarization of the economy, impacting strategic sectors such as wholesale and retail trade, tourism, and foreign trade. It will also facilitate the use of cash dollars in sectors such as pharmacies, airports, and exporting agricultural producers.
In an economic context characterized by inflation and the failure of previous economic policies, the regime is once again trying to regain control over a landscape where the rules of the informal market largely shape the economic reality of the population.
Equivalencies of each available euro and US dollar bill to Cuban pesos (CUP)
U.S. Dollar (USD) to Cuban Peso (CUP) according to the exchange rates for December 23:
Conversion of bills to pesos:
1 USD = 310 CUP.
5 USD = 1,550 CUP.
10 USD = 3,100 CUP.
20 USD = 6,200 CUP.
50 USD = 15,500 CUP.
100 USD equals 31,000 CUP.
Euros (330 CUP for each euro):
1 EUR = 320 CUP.
5 EUR = 1,600 CUP.
10 EUR = 3,200 CUP.
20 EUR = 6,400 CUP.
50 EUR = 16,000 CUP.
100 EUR = 32,000 CUP.
Frequently Asked Questions about the Informal Currency Market in Cuba
Why has the price of foreign currencies decreased in the informal Cuban market?
The price of currencies has decreased due to the announcement by the Cuban government regarding the implementation of a more flexible official exchange rate that will respond to market supply and demand. This aims to regulate the currency market and reduce the disparity with the informal market.
What is the "floating exchange rate" announced by the Cuban government?
The "floating exchange rate" is a mechanism that will adjust the official exchange rate according to market supply and demand. The specific details and the date this measure will come into effect are not yet known, but it aims to compete with the informal currency market.
How does the situation in the currency market affect the average Cuban?
The situation in the foreign exchange market significantly impacts the average Cuban, as inflation and the scarcity of foreign currency limit their purchasing power. Most of the population turns to the informal market to obtain basic goods, which exacerbates their daily economic difficulties.
What is the current value of currencies in the Cuban informal market?
The current value of the dollar in the Cuban informal market is 310 CUP, while the euro is trading at 320 CUP, and the freely convertible currency (MLC) is at 260 CUP. These values have been declining recently due to the economic measures announced by the government.
What role does the Free Convertible Currency (MLC) play in the Cuban economy?
The MLC is a virtual currency used in specific stores in Cuba, and its current value in the informal market is 260 CUP. It is crucial for accessing certain products, as the Cuban government employs it in its commercial operations, reflecting its significance in the country's economy.
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