This Tuesday, Cuba's informal currency market witnesses yet another historic high: the U.S. dollar jumps by 4 pesos in a single day, reaching 540 Cuban pesos (CUP)—the largest daily increase in weeks, according to data from the monitor elTOQUE.
The euro follows closely behind, rising by 3 pesos to hit 618 CUP, edging dangerously close to the 620-peso threshold. Meanwhile, the freely convertible currency (MLC) remains steady at 420 CUP.
This Tuesday's trading session reinforces an upward trend that shows no signs of slowing down, as record-breaking highs continue to chain together in Cuba's informal market.
On Monday, the dollar had reached 536 CUP and the euro 615 CUP, both setting historical peaks at the time. Additionally, the MLC made a notable leap of twenty pesos in one day, jumping from 400 to 420 CUP.
The euro first broke through the psychological 600 CUP barrier on April 19 and has been climbing ever since: 605 CUP on April 28, 610 CUP on May 2, 615 CUP on Monday, and now 618 CUP.
The dollar, on the other hand, closed April at 535 CUP, surpassing the projections of the Cuban Currency and Finance Observatory (OMFi), which had forecast a ceiling of 533 CUP for that month.
Underlying Factors Behind Currency Surge
Several deep-rooted structural factors are driving this currency spiral. Since January 2026, Venezuela has completely halted its crude oil supply to Cuba, which previously fulfilled 30% to 35% of the island's energy demands.
Compounding this issue is the collapse of tourism: the first quarter of 2026 saw a 48% year-over-year drop in arrivals, with only 298,057 visitors, and March recorded a mere 35,561 international tourists.
The International Monetary Fund (IMF) projects a 7.2% contraction in Cuba's GDP for 2026, while excessive monetary issuance to finance the fiscal deficit exacerbates the scarcity of foreign currency in the banking system.
The OMFi had warned that "the apparent stability of exchange rates in previous days was not due to structural improvement but rather a slowdown in economic activity amid an economic crisis."
The organization projected a range of 503 to 590 CUP for the dollar and 574 to 640 CUP for the euro. With the dollar now at 540 CUP and the euro at 618 CUP, both currencies are advancing towards the more pessimistic ceilings of that range without any structural factor indicating a reversal in the trend.
FAQs on Cuba's Currency Situation
Why is the dollar rising so rapidly in Cuba?
The rapid increase in the dollar's value against the Cuban peso is driven by structural issues such as the halt in Venezuelan crude oil supply and a significant drop in tourism, alongside excessive monetary issuance.
What are the implications of the euro reaching 618 CUP?
The euro reaching 618 CUP highlights the weakening of the Cuban peso and indicates economic instability, as the currency approaches critical thresholds that have been projected by economic observers.
How does the IMF view Cuba's economic future?
The IMF forecasts a 7.2% contraction in Cuba's GDP for 2026, pointing to ongoing challenges in economic growth and fiscal management.