The U.S. dollar has started the week with another significant drop, falling by 10 pesos in the informal exchange market in Cuba. As of 7 a.m. local time on May 27, the dollar is valued at 330 CUP. The dollar has plunged by 20 pesos in just 48 hours, accumulating a 65-peso drop in 12 days since it began its decline on May 16.
The Freely Convertible Currency (MLC) also saw a decrease today, now standing at 280 CUP, which is five pesos less than the previous day. Meanwhile, the euro remains steady at 350 CUP.
Although many Cubans see the decrease in the informal currency prices as beneficial, they question why the prices of consumer goods have not followed suit. "The dollar drops, but I don't see any prices going down"; "They’re testing their strength because food prices aren’t dropping. Something strange is happening"; "When will the prices of products drop? Sellers used to say prices went up because the dollar was rising, so what now?" are common comments on social media.
Meanwhile, those holding the currency recommend waiting, as they believe it will eventually rise again. The Cuban government remains silent on the issue. The only recent intervention by the state has been from Casas de Cambio S.A. (CADECA), which labeled as "false" the information circulating on social media that suggested their branches would start selling dollars at 375 pesos from May 27.
Current Exchange Rates in Cuba (May 27, 2024 - 7:00 a.m.)
According to elTOQUE, the exchange rates are as follows:
- USD to CUP: 330 CUP
- EUR to CUP: 350 CUP
- MLC to CUP: 280 CUP
Alternative platform exchange rates:
- USD: Buy at 326 CUP, Sell at 335 CUP
- EUR: Buy at 335 CUP, Sell at 349 CUP
- MLC: Buy at 280 CUP, Sell at 284 CUP
It's important to note that these informal exchange rates are not officially recognized or backed by any financial or governmental entity.
Currency Conversion Rates
The following are the current conversions for euros and U.S. dollars to Cuban pesos (CUP) as of Monday, May 27:
U.S. Dollar (USD) to Cuban Peso (CUP):
- $1 USD = 330 CUP
- $5 USD = 1,650 CUP
- $10 USD = 3,300 CUP
- $20 USD = 6,600 CUP
- $50 USD = 16,500 CUP
- $100 USD = 33,000 CUP
Euro (EUR) to Cuban Peso (CUP):
- €1 EUR = 350 CUP
- €5 EUR = 1,750 CUP
- €10 EUR = 3,500 CUP
- €20 EUR = 7,000 CUP
- €50 EUR = 17,500 CUP
- €100 EUR = 35,000 CUP
- €200 EUR = 70,000 CUP
This information can be useful for calculating the cost in Cuban pesos of any amount of dollars or euros. These conversions are based on the rates provided of 330 CUP per dollar and 350 CUP per euro.
Last week, the independent media outlet elTOQUE shared its opinion about the sharp decline in the value of dollars, euros, and MLC, mentioning several factors that might be influencing this sudden drop. However, it does not believe that what we are witnessing indicates a real revaluation of the national currency.
In his analysis, Pavel Vidal Alejandro suggested that one possible cause is the so-called "market sentiment," meaning that "an increasing number of people started to consider the exchange rates excessively high and opted to sell before a potential drop," which spiked the supply. Pavel Vidal noted that since mid-May—coinciding with the start of the decline of the three reference currencies—there has been a notable increase in the supply of foreign currencies in monitored virtual spaces.
Additionally, elTOQUE pointed out that it is normal for "temporary corrections to occur after an extended bullish period in the market" and emphasized that since 2022 there have been six pronounced and consecutive drops in currency values. These declines have lasted for weeks in some cases but have eventually recovered. The economic analyst argued that the fundamental factors causing internal and external imbalances in the Cuban economy have not changed, and thus "the current rate inflection should not be associated with a long-term trend modification."
ElTOQUE sees it as challenging to predict what will happen next because "there are many informational gaps that make it difficult to accurately measure the magnitude and evolution of the current crisis."
Understanding the Recent Decline in the Cuban Peso
Here are some common questions and answers regarding the recent sharp decline in the value of the U.S. dollar and other currencies in Cuba.
Why has the U.S. dollar dropped so significantly in Cuba?
Analysts suggest that a change in market sentiment and an increase in the supply of foreign currencies have contributed to the sharp decline.
Will the prices of consumer goods decrease as well?
Despite the drop in currency values, there has been no corresponding decrease in the prices of consumer goods, leading to public frustration.
Is the Cuban government addressing this issue?
The Cuban government has remained silent, with the only recent intervention being CADECA's denial of false information about exchange rates.
What is the outlook for the Cuban peso?
It is difficult to predict the future as there are many informational gaps, but analysts expect temporary corrections rather than a long-term trend change.