This Thursday, the three main currencies in the Cuban informal market have shown dramatic price hikes compared to the previous day, with increases ranging from 10 to 30 pesos. After nearly three weeks of declining average sales values, the euro and dollar have rebounded for the second consecutive day, and now the MLC has joined the uptrend.
The euro has surged significantly, as by 7 AM (local Cuban time) on June 6, the European currency is averaging 350 CUP, which is 30 pesos higher than the day before. The dollar, on the other hand, has risen by 20 pesos for the second day in a row, going from 300 to 320 CUP. The Freely Convertible Currency (MLC) has increased by 10 pesos, bringing its average sales value to 270 CUP.
The informal currency market is giving a strong signal of recovery today, following an unprecedented decline that began with the dollar on May 16, characterized by a rapid drop in currency values over two weeks. The three currencies only paused their decline on June 4, when none saw any price changes. This Thursday's surge suggests that prices could potentially skyrocket at the same rate they fell. The question on everyone's mind is: Will these currencies surpass the record prices they reached in Cuba's informal market?
Exchange Rates as of June 6, 2024 - 7:39 AM in Cuba
Exchange rate for the dollar (USD) to CUP according to elTOQUE: 320 CUP.
Exchange rate for the euro (EUR) to CUP according to elTOQUE: 335 CUP.
Exchange rate for the MLC to CUP according to elTOQUE: 270 CUP.
Alternative exchange rates from other platforms:
Exchange rate for the dollar (USD): Buy 307 CUP, Sell 333 CUP.
Exchange rate for the euro (EUR): Buy 315 CUP, Sell 332 CUP.
Exchange rate for the MLC: Buy 262 CUP, Sell 272 CUP.
The informal exchange rate in Cuba provided here is not officially recognized or backed by any financial or governmental entity.
In an extensive article published on May 21, elToque, an independent media outlet that has been documenting the fluctuations in currency prices in the Cuban informal market since 2019, shared insights on the sharp decline in the value of dollars, euros, and MLC. Economist Pavel Vidal Alejandro pointed out that the announcement of the resumption of remittance services to the island via Western Union (on May 9) and the proximity to a closed value (400 CUP x 1 USD) might have influenced market expectations and sentiment.
The economist noted that a "new balance in consensus and market participant attitudes" had formed. In other words, "an increasing number of people began to consider that currency prices were excessively high and opted to sell before a potential drop," which spiked the supply. Additionally, the outlet mentioned that it's natural for “temporary corrections to occur after an extended bullish period in the market.”
Since 2022, there have been six pronounced and consecutive declines in currency values, sometimes lasting weeks, but they have always recovered. Vidal Alejandro emphasized that the fundamental factors causing internal and external imbalances in the Cuban economy had not changed, and thus the temporary currency decline should not be interpreted as a genuine revaluation of the Cuban peso.
Frequently Asked Questions About the Rapid Surge in Cuban Currency Prices
Below are some frequently asked questions regarding the recent rapid increases in the value of the dollar, euro, and MLC in Cuba's informal market.
Why have the values of the dollar, euro, and MLC surged suddenly in Cuba?
The surge is due to a recovery in the market after nearly three weeks of price declines. Additionally, market sentiment and expectations were influenced by the announcement of the resumption of remittance services via Western Union.
What are the current exchange rates for the dollar, euro, and MLC in Cuba?
As of June 6, 2024, the exchange rates are as follows: 320 CUP for the USD, 335 CUP for the EUR, and 270 CUP for the MLC according to elTOQUE.
What factors influenced the recent currency price declines?
Economist Pavel Vidal Alejandro noted that the announcement of Western Union resuming remittance services and market participants' expectations of a drop influenced the recent declines.