Yo Yo Exchange!
The exchange rate of the
US dollar and the Costa
Rican colon has been one
of ups and downs during
the last couple of
weeks. Yesterday the
exchange rate dropped a
whopping ˘21 colones in
one single day, after
reaching a high late
last week.
From the opening of the
markets Monday morning,
the dollar exchange
against the colon began
falling slowly,
increasing rapidly,
closing at ˘18 colones
lower by the close of
the markets.
The Banco Central de
Costa Rica (BCCR) -
Central Bank - buy
reference rate at the
opening Monday was
˘550.30 and the sell
˘560.81. This morning
(Tuesday), the buy
˘528.56, a difference of
21.74, and the sell
˘540.95, a difference of
˘19.86.
The banks, both state
and private, reacted
quickly to changes,
dropping their rates
several times during the
day. In some cases
customers waiting in
line at the bank found a
different rate at the
counter than the rate
posted on the board.
Economists and financial
experts believe the
swings are due to
speculation in the
market, although Central
Bank officials say it is
normal for year end as
there is an oversuplly
of dollars in the
market.
Opponents to the "bandas
cambiaras" (exchange
band) policies of the
Central Bank say the
policy leads to a lot of
speculation and astute
investors entering the
marketplace and cashing
in big in a manner of
minutes, sometimes in
seconds with the click
of the mouse.
Johnny Alavardo, an
economist for the
Universidad de Costa
Rica (UCR), the country
should have a fixed
exchange rate that would
eliminate speculation.
The current policy of
the Central Bank
maintains a low band of
˘500 colones and a high
of ˘555.37.
|
