The informal foreign currency market in Cuba is witnessing a significant drop in the value of U.S. dollars and euros after several consecutive days of steep declines. On Monday, both the U.S. dollar and the euro fell by five points compared to the previous day's rate, as calculated by the independent outlet elTOQUE, which analyzes the median prices from buy-sell ads for foreign currencies on social media and Cuban classified sites.
Within less than 24 hours, the U.S. dollar dropped another five pesos, settling at 375 Cuban pesos (CUP) on Monday. Similarly, the euro experienced the same drop, with its rate now at 385 CUP. The Freely Convertible Currency (MLC) remains the only stable currency, holding steady at 300 CUP.
Today's Exchange Rates in Cuba
As of May 20, 2024, at 6:13 am in Cuba, the exchange rates according to elTOQUE are as follows:
- USD to CUP: 375 CUP
- EUR to CUP: 385 CUP
- MLC to CUP: 300 CUP
Alternate exchange rates from other platforms are:
- USD: Buy at 369 CUP, Sell at 378 CUP
- EUR: Buy at 376 CUP, Sell at 389 CUP
- MLC: Buy at 295 CUP, Sell at 300 CUP
In recent days, the average sale of the three main currencies in Cuba's informal market showed signs of stagnation. However, the last 72 hours have confirmed a sharp decline in their rates. An article published by elTOQUE earlier this month had warned that models from the Cuba Currency and Finance Observatory (OMFi) predicted a continued depreciation of the peso in May.
Contrary to the forecast—which the Cuban regime has accused of causing "induced inflation"—the peso has rapidly and unexpectedly appreciated. The sudden drop in foreign currency values has puzzled economic analysts, who speculate this may be due to an increased supply of foreign currency in the black market. Awaiting further data to confirm this trend, many are beginning to suspect a hypothetical and sudden "injection" of foreign currency into Cuba's informal market.
In the absence of improvements in food production, energy supply, and amidst frequent power outages and social unrest, many are questioning the source of the peso's unexpected purchasing power. In a matter of days, and without signs of improvement in an economy marked by high inflation, the Cuban peso has started to gain ground against foreign currency prices in Cuba.
Understanding the Decline in Cuba's Informal Currency Market
Below are some frequently asked questions to help understand the recent developments in Cuba's informal currency market.
Why did the U.S. dollar and euro drop in value in Cuba's informal market?
The drop is largely attributed to an increased supply of foreign currency in the black market, although the exact reasons are still under investigation.
What is the current exchange rate for the U.S. dollar in Cuba's informal market?
As of May 20, 2024, the exchange rate for the U.S. dollar is 375 CUP according to elTOQUE.
Has the Freely Convertible Currency (MLC) been affected?
No, the MLC has remained stable at 300 CUP.
What are the implications of this sudden revaluation of the Cuban peso?
The unexpected appreciation of the peso raises questions about the source of the increased foreign currency supply and its impact on Cuba's struggling economy.