Dollar Value Rises in Cuba for Second Consecutive Day

The value of the U.S. dollar continued its upward trend on Thursday in Cuba's informal market, reaching an average selling price of 620 Cuban pesos (CUP), according to data from elTOQUE. This 10 CUP increase from Wednesday marks two consecutive days of gains, which analysts describe as a partial rebound following a significant correction in late June.

Continuous Climb Over Two Days

On Wednesday, July 1, the dollar had already increased from 605 CUP on June 30 to 610 CUP. With Thursday's rise, the American currency has regained 15 CUP in just 48 hours since hitting a recent low.

Recent Corrections and Historical Peaks

This upward correction comes after the dollar hit an all-time high of 695 CUP on June 21, while the euro nearly reached 800 CUP. From that peak, the U.S. dollar plummeted by 90 pesos over nine days, with a particularly sharp drop on June 26, when it fell to 670 CUP in a single day.

Stability of Euro and MLC

As the dollar makes its comeback, two other key currencies remain stable. The euro holds steady at 700 CUP for the fourth consecutive day, having retreated from its June high of nearly 800 CUP. The MLC (Freely Convertible Currency) remains unchanged at 500 CUP.

Meanwhile, the official exchange rate set by the Central Bank of Cuba floats around 585-589 CUP per dollar, significantly lower than the informal market rate.

Understanding the "Overshooting" Phenomenon

Analysts at elTOQUE have explained these fluctuations as a recurring economic pattern in Cuba since 2022. According to their analysis of exchange rate "overshooting," when expectations shift—due to economic policy announcements, rumors, or crises of confidence—the foreign currency price often surges beyond what economic fundamentals justify.

The most recent trigger was the package of 176 economic measures approved by the National Assembly on June 19, which, for the first time since 1959, includes authorizing private banking and a digital exchange market. This announcement spurred a wave of expectations, driving currencies to historic highs, followed by subsequent corrections.

Nonetheless, elTOQUE warns that the rebound does not signify a real improvement: "when the market fully understands the true scope of the change, it corrects. But the correction is never complete. The new floor remains higher than before."

The outlet also points to the so-called "herd effect" as a driver of these fluctuations: "people buy foreign currency not because they have rationally assessed the situation, but because they see others buying, and the fear of being left behind fuels the rise."

Independent Economists Express Skepticism

Independent economists do not share the optimism some sectors express about the regime's measures. Economist Pedro Monreal González described the 176-measure package as a "monster" or "deformed hybrid," bluntly stating: "the numbers don't add up, and the government wants to make it seem like it's not a math problem but a matter of will."

Pavel Vidal, a specialist at the Observatory of Monetary and Financial Studies (OMFi), agrees that "Cuban exchange markets sometimes move exuberantly with waves of optimism or pessimism," despite no structural changes in the fundamentals.

The Six-Year Freefall

The backdrop explaining these turbulent conditions is dire. In 2020, the dollar traded at 42 CUP in the informal market. By January 2026, it had reached 435 CUP. On June 21 this year, it hit 695 CUP. In just six years, the Cuban peso has lost more than 95% of its value.

elTOQUE sums it up succinctly: "this trajectory depends on the real scarcity of foreign currency, triple-digit inflation, fiscal deficits, and structural distrust in the Cuban peso. As long as these conditions persist, the rate will continue to rise." Pavel Vidal warns that "restoring confidence, certainty, and hope will be difficult."