Dollars and euros saw a new drop in their average selling prices in Cuba's informal market this Wednesday morning.
As of 7 a.m., the dollar stands at 370 pesos, ten units less than the previous afternoon's rate of 380 pesos. This decrease follows a tumultuous Tuesday where the dollar experienced multiple drops. The euro also fell from 400 to 390 pesos, a ten-peso decline from the previous day. Meanwhile, the Moneda Libremente Convertible (MLC) remains stable at 300 CUP.
Despite the dollar nearing its previous record high of 395 pesos earlier this May, it has dropped 20 pesos in the last 48 hours, further highlighting the exchange rate instability that has plagued recent weeks. This volatility raises many questions about the future trajectory of the market amid Cuba's ongoing economic crisis.
While the week began with a Monday where all three currencies—dollars, euros, and MLC—remained unchanged, the past 48 hours have seen a significant downward trend. This comes after five days of rapid increases where these currencies regained and even surpassed their values from before the May downturn. The market fluctuations underscore the Cuban government's failure to implement measures to reverse the crisis.
The volatility in Cuba's informal currency market over the past weeks has once again confirmed the economic decline and growing public uncertainty. Citizens are increasingly concerned about the financial impact on their daily lives.
Exchange rates as of 7:10 a.m. on June 12, 2024, in Cuba, according to elTOQUE:
- USD to CUP: 370 CUP
- EUR to CUP: 390 CUP
- MLC to CUP: 300 CUP
These informal exchange rates are not officially recognized or backed by any financial or governmental entity.
Current exchange equivalents for USD and EUR:
- $1 USD: 370 CUP
- $5 USD: 1,850 CUP
- $10 USD: 3,700 CUP
- $20 USD: 7,400 CUP
- $50 USD: 18,500 CUP
- $100 USD: 37,000 CUP
- €1 EUR: 370 CUP
- €5 EUR: 1,950 CUP
- €10 EUR: 3,900 CUP
- €20 EUR: 7,800 CUP
- €50 EUR: 19,500 CUP
- €100 EUR: 39,000 CUP
- €200 EUR: 78,000 CUP
- €500 EUR: 195,000 CUP
Neither the new Minister of Economy nor other island authorities have publicly addressed the significant decline in currency prices since mid-May, or the rapid rebound in buying and selling values. Amid this governmental inaction, independent media outlet elTOQUE announced that it has tightened controls on calculating the representative exchange rate due to growing suspicions of attempts to manipulate values with false announcements.
elTOQUE claimed that a campaign by "government actors associated with State Security and propagandists of the Communist Party" has sought to discredit their methodology since April. They also pointed to private sector players who allegedly claim the ability to coordinate efforts to appreciate the Cuban peso.
elTOQUE asserts that they have “evidence of actions aimed at flooding virtual currency exchange spaces with false offers to influence the algorithm” used to calculate the rate. The independent media outlet maintains that their calculations are transparent and acknowledge the limitations, primarily that they cannot confirm which buy-sell announcements are finalized. Despite these challenges, they argue that the calculated rate reflects central market movements, though they admit it is inherently speculative.
"Neither the informal currency market nor a service that makes it visible are the root of the problems. They are, at most, reflections of the imbalances and inflation affecting the Cuban economy. The solution lies with the State and those who govern the country, who alone have the institutional capacity to implement an economic stabilization program that includes structural reforms," they concluded.
Understanding Cuba's Currency Market Fluctuations
To provide further insight into the ongoing currency market fluctuations in Cuba, here are some commonly asked questions and their answers:
Why are the dollar and euro experiencing declines in Cuba's informal market?
The declines are largely due to market volatility and the lack of governmental measures to stabilize the economy. Recent fluctuations reflect the broader economic instability in Cuba.
What is the current exchange rate for the dollar and euro in Cuba?
As of June 12, 2024, the dollar is exchanged at 370 CUP and the euro at 390 CUP in the informal market, according to elTOQUE.
How does elTOQUE calculate the representative exchange rate?
elTOQUE uses documented buy-sell announcements to calculate the exchange rate. Although they acknowledge the speculative nature of the market, they believe their methodology accurately reflects central market movements.
What actions are being taken to address false exchange rate announcements?
elTOQUE has reinforced controls to calculate the exchange rate to counteract attempts to manipulate values with false announcements, which they attribute to government and private sector actors.