In a new chapter of a seemingly endless story, this Friday, two of the three benchmark currencies in the Cuban informal market have risen in price.
The euro rises from 400 to 402.5 CUP, with an increase of 2.5 pesos, according to elToque today in the daily rate reporting the price fluctuations of currencies in informal sales.
On the other hand, the average sale of the Freely Convertible Currency (MLC) increased by five pesos all of a sudden, and after remaining at 300 pesos for six days, it is valued today at 305 CUP.
Only the dollar remains stable this May 10, continuing at 395 CUP per unit, a value it reached the previous day.
Exchange rate today 10/05/2024 - 7:35 a.m. in Cuba:
USD to CUP exchange rate according to elTOQUE: 395 CUP.
Exchange rate of the euro EUR to CUP according to elTOQUE: 402.5 CUP.
Exchange rate from MLC to CUP according to elTOQUE: 305 CUP.
Alternative exchange rate of other platforms:
Exchange rate of the dollar (USD): Buy 391 CUP, Sell 393 CUP.
Exchange rate of the Euro (EUR): Buy 400 CUP, Sell 400 CUP.
Exchange rate for MLC: Buy 301 CUP, Sell 301 CUP.
The informal exchange rate of Cuba offered here is not officially recognized or backed by any financial or governmental entity.
The Cuban peso continues its relentless march towards the abyss
A detailed article published yesterday by elToque outlines what it describes as "strong turbulence" experienced by the foreign exchange market in Cuba in April.
"April 2024 marked a peak in the devaluation of the Cuban peso," stated elToque, noting that the surge in informal exchange rates last month represents the largest monthly depreciation of the Cuban peso so far this year.
In percentage terms, in April the Cuban peso depreciated by more than 13% relative to the dollar and the euro, and by more than 5% against the MLC.
During April, the rate increased 5 CUP in a single day on three occasions in relation to the dollar and twice in relation to the euro.
According to analysts from the Observatory of Money and Finance of Cuba (OMFi), the accelerated depreciation of the Cuban peso in April was due to four factors that are part of the economic and financial crisis the country is experiencing: "rising inflation, stagnation of production and exports, high fiscal deficit, and emigration."
In the first quarter of 2024, the food, transportation, and alcoholic beverages categories recorded the most significant increases, with inflation rates considerably higher than the overall CPI.
Another cause of the devaluation of the Cuban peso would be the sluggish recovery of tourism, the fact that exports of goods have fallen short of expectations, and the sugar cane harvest continues to fail to stabilize its production, emphasizes the aforementioned independent outlet.
According to elToque, the migration wave would also be an aggravating factor that shows no signs of abating and entails an additional demand for foreign currency in the informal market.
Tendency toward devaluation could persist through the rest of May
The OMFi models "foresee that the depreciation trend could continue in May and predict that the informal exchange rate could be around 417-427 CUP per dollar, 422-433 CUP per euro, and 316-324 CUP per MLC by the end of the month.
However, they also suggest that a slowdown in the pace of peso depreciation is likely in the coming months.
As the informal currency exchange rate in Cuba continues to rise without limit, inflation also remains unchecked, leaving a bleak outlook in which Cubans see their purchasing power diminish day by day.
In the midst of this scenario, the Cuban regime seems to be in a dead end, unable to offer economic solutions to the problem and choosing to blame elToque for the devaluation of the CUP.
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