The informal foreign exchange market in Cuba starts this Tuesday with a new development: the resurgence of the Convertible Currency (MLC).
In the last few hours, the MLC, which plummeted dramatically by 25 pesos this Monday, has recovered some of its losses and risen to 270 CUP, which is 10 pesos more than the value it reached on December 1st.
The dollar, for its part, remains at 450 CUP for the third day, a value it reached this Sunday.
Also unchanged the euro, which is still priced at 490 CUP.
Exchange Rate Evolution
Exchange rate today 02/12/2025 - 6:55 a.m. in Cuba:
Exchange rate of the dollar USD to CUP according to elTOQUE: 450 CUP.
Exchange rate of the euro EUR to CUP according to elTOQUE: 490 CUP.
Exchange rate of MLC to CUP according to elTOQUE: 270 CUP.
The backdrop of the offensive against the informal currency market
In recent weeks, the Cuban government has intensified its campaign against the informal currency market and against the reference rate published by the independent media elTOQUE.
This offensive includes criminal investigations, threats to currency exchange operators, and a communication strategy aimed at discrediting alternative sources of dollar, euro, and other currency prices.
Although the attack may seem like a distraction from the deep economic crisis in the country, an article published this Monday by economist Pavel Vidal in elTOQUE suggests that the real objective is to clear the way for implementing a new floating official exchange rate, previously weakening the informal market and its key players.
This move aims to capture remittances through official channels and have greater control over the flow of foreign currency, but for this, the Government is resorting to coercive mechanisms instead of competing with transparency and attractive rates.
The failures of previous policies, such as the monetary regulation of 2021 and the adjustment of 2022, have left the Government in a vulnerable position.
In both cases, the informal market showed that the official rates were disconnected from the economic reality.
The truth is that, since then, the informal rate has become a key indicator of the deterioration of purchasing power and inflation, given the secrecy surrounding official figures.
The government is now proposing a floating rate, but doubts remain about its actual viability in a system that doesn't operate under market logic.
Furthermore, there are signs that the true interest behind the formalization would be to collect foreign currency rather than to improve the efficiency or legality of the exchange system. If the state buys foreign currency without subsequently offering it to the public, it could further exacerbate inflation, according to Vidal's conclusions.
Finally, elTOQUE warns that without structural reforms, a supposedly floating official rate could lead to a new distortion, this time from the state apparatus itself.
Imposing an unrealistic tax or suppressing the informal market without providing better conditions would only bring negative consequences, such as a decline in remittances, a halt in private trade, and increased shortages.
Time will tell the last word.
Equivalence of United States Dollar (USD) to Cuban Peso (CUP), according to the exchange rates as of December 2nd:
1 USD = 450 CUP.
5 USD = 2,250 CUP.
10 USD = 4,500 CUP.
20 USD = 9,000 CUP.
50 USD = 22,500 CUP.
100 USD = 45,000 CUP.
Equivalence of Euro (EUR) banknotes to Cuban Peso (CUP):
1 EUR = 490 CUP.
5 EUR = 2,450 CUP.
10 EUR = 4,900 CUP.
20 EUR = 9,800 CUP.
50 EUR = 24,500 CUP.
100 EUR = 49,000 CUP.
200 EUR = 98,000 CUP.
500 EUR = 245,000 CUP.
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