This Monday morning, the informal currency market in Cuba shows no change from Sunday's close: the U.S. dollar remains at 695 Cuban pesos (CUP), the euro holds steady at 800 CUP, and the freely convertible currency (MLC) is stable at 510 CUP, according to data from elTOQUE, a leading platform for monitoring the island's informal exchange rates.
After a week of unprecedented increases, Sunday's trading saw the euro break the 800 CUP barrier for the first time, setting a new all-time high, while the dollar solidified its position at 695 CUP.
Wide Offer Ranges Reflect Market Fragmentation
Despite the stable reference prices, individual offers between buyers and sellers show significant variability. As reported by elTOQUE, the current ranges this Monday are as follows:
Euro (EUR): from 720 to 864 CUP
Dollar (USD): from 615 to 760 CUP
MLC: from 430 to 570 CUP
This price disparity highlights the fragmented nature of the informal market, where each deal is influenced by the seller's urgency, the buyer's availability, and geographical location.
A Month of Unprecedented Climbing
The stability seen this Monday is in stark contrast to the rapid depreciation observed throughout June. The dollar began June at 585 CUP and has surged by 110 CUP over 21 days, a rise of more than 18%. Similarly, the euro has risen from 645 CUP, climbing 155 pesos during the same period, marking an increase exceeding 23%.
The peso's depreciation has outpaced all predictions. At the start of June, elTOQUE's Currency and Finance Observatory (OMFi) projected a ceiling of 650 CUP for the month, a threshold surpassed by June 12, 18 days earlier than anticipated.
The dollar's trajectory this month illustrates the acceleration: from 585 CUP on June 1, to 625 on June 8, 660 on June 14, 680 on June 17, 693 on June 20, and remaining at 695 from Sunday through today.
Official Rate Lags Behind Informal Market
While the informal market quotes the dollar at 695 CUP, the Central Bank of Cuba maintains the official rate at 565 CUP through CADECA, and the euro at 647 CUP, creating a gap of 130 CUP per dollar and 153 CUP per euro between the two markets.
In January 2026, this gap was 71 CUP per dollar. In just six months, the currency gap has nearly doubled, making the informal market the true price benchmark for most Cubans.
Reforms Fail to Ease Currency Pressure
On June 19, Prime Minister Manuel Marrero Cruz unveiled a package of 176 economic measures—the largest since the Special Period—including private banking, private exchange houses, currency auctions, and an openness to foreign investment.
Nevertheless, the informal market continued its upward trend following the announcement, with reforms failing to alleviate exchange rate pressure. In an unusual admission, Díaz-Canel acknowledged before the Assembly that "there are obstacles that do not come from outside or from the embargo," admitting some internal responsibility.
Historical Perspective: Peso's Massive Devaluation
Back in 2020, the dollar traded at about 42 CUP in the informal market. As of this Monday, it trades at 695 CUP, representing a loss of over 95% of the peso's value in just six years.
Economist Elías Amor has cautioned that Cuba's fiscal deficit exceeds 12% of GDP, and the chronic currency shortage will sustain upward pressure. "Currency inflows to Cuba are unlikely in the coming months," he noted, adding: "People will be willing to pay whatever it takes to get foreign currency."
The euro, which hit 500 CUP in October 2025—then considered a historical high—has since increased by an additional 300 pesos in less than a year, with no sign of reversing in the near future.
Understanding Cuba's Currency Challenges
Why is the Cuban peso depreciating so rapidly?
The rapid depreciation of the Cuban peso is driven by severe economic imbalances, including a fiscal deficit of over 12% of GDP, and a significant shortage of foreign currency, exacerbating the informal market's volatility.
What impact do economic reforms have on the currency market?
Recent economic reforms, such as the introduction of private banks and exchange houses, have not yet alleviated the pressure on the currency market, as evidenced by continued increases in informal exchange rates.
How does the gap between informal and official rates affect Cubans?
The widening gap between informal and official exchange rates creates a situation where most Cubans rely on the informal market for an accurate reflection of currency value, often resulting in higher costs for goods and services.