As dawn broke on Tuesday, both the U.S. dollar and the euro continued their upward trajectory in Cuba's informal market. By 8:00 a.m. local time, the American currency was trading at an average of 227 CUP, an increase of two pesos compared to the previous day. The euro's rise was even more pronounced, reaching 335 CUP, marking a sharp jump of ten units and distancing itself from the dollar.
Meanwhile, the Moneda Libremente Convertible (MLC) held steady at 250 CUP, highlighting the significant gap between it and other currencies. This reflects the ongoing uncertainty surrounding the Cuban government's virtual currency, which seems poised for obsolescence following the regime's partial "dollarization" strategy.
Current Exchange Rates and Economic Factors
As of January 7, 2025, at 8:50 a.m. in Cuba, the exchange rates according to elTOQUE are as follows: the USD to CUP stands at 327, the EUR to CUP at 335, and the MLC to CUP at 250. The fluctuations in currency prices in Cuba are closely tied to several economic and social factors. A recent development includes the opening of a new supermarket in the Cuban capital, exclusively accepting foreign currencies like dollars and euros. This has been a significant step in the dollarization process initiated by the Cuban government.
This development has heightened the demand for hard currency, as an increasing number of essential goods are only available in stores that operate in foreign currencies, excluding MLC. This shift has reignited uncertainty as most essential transactions now require foreign currency, diminishing the value of CUP and MLC as viable means of purchase.
Impact on Cuban Economy and Citizens
The constant rise in exchange rates directly impacts Cubans' purchasing power, who rely heavily on the informal market for access to dollars, euros, or MLC to buy food, medicine, or other necessities. Many families sustain themselves through remittances sent from abroad, whose value in CUP has surged recently.
Cuba's economy faces structural challenges exacerbating the currency crisis. The combination of inflation, shortages, and the absence of a functional official exchange market is leaving citizens in a state of extreme vulnerability.
Currency Conversion Rates
Here are the current conversion rates for each available denomination of U.S. dollars and euros to Cuban pesos (CUP), based on the exchange rates of January 7:
- 1 USD: 327 CUP
- 5 USD: 1,635 CUP
- 10 USD: 3,270 CUP
- 20 USD: 6,540 CUP
- 50 USD: 16,350 CUP
- 100 USD: 32,700 CUP
- 1 EUR: 335 CUP
- 5 EUR: 1,675 CUP
- 10 EUR: 3,350 CUP
- 20 EUR: 6,700 CUP
- 50 EUR: 16,750 CUP
- 100 EUR: 33,500 CUP
Understanding Cuba's Currency Crisis
Why are dollar and euro rates rising in Cuba's black market?
The rise is due to increased demand for foreign currencies, driven by the dollarization process and the need to purchase essentials in stores accepting only foreign currencies.
What is the impact of the rising currency rates on Cuban citizens?
Rising rates decrease purchasing power, forcing Cubans to depend on the informal market for necessities, affecting their ability to afford basic items.
How does the current economic climate contribute to the currency crisis?
Economic challenges such as inflation, shortages, and the lack of a functional official exchange market contribute significantly to the crisis.