The governor of the Central Bank of the Dominican Republic (BCRD), Héctor Valdez Albizu, has announced a plan to inject $200 million into the exchange rate market between the end of December 2023 and the beginning of January 2024. This initiative is intended to provide sufficient liquidity conditions in foreign currency. In collaboration with multiple banks, Valdez Albizu has outlined a comprehensive strategy to ensure the market’s liquidity and stability.
The BCRD has committed to supporting this effort, sharing the financial responsibility with public and private banks. The central bank’s goal is to ensure that various economic agents can conduct foreign currency purchases and manage exchange risk expectations freely. The BCRD serves as the administrator of the exchange platform, monitoring its operations and ensuring its proper functionality.
In addition to the exchange market strategies, the BCRD also highlights its international reserves, which total US$15,332.7 million as of December 22, 2023. These reserves represent 12.7% of the gross domestic product and are equivalent to 5.7 months of imports. The central bank has reassured the public of its commitment to maintain balanced access to dollars for the productive sectors, including micro, small, and medium-sized enterprises (MSMEs).
Remittances have also played a critical role in the Dominican Republic’s foreign exchange situation. The BCRD projects that remittances will exceed US$10 billion by the end of 2023. In the month of November, remittances reached US$788.0 million, with most of the flows originating from the United States. The BCRD expects continued significant flows from remittances, exports, tourism income, and foreign direct investment for the remainder of 2023.
Tourism income is anticipated to surpass US$10 billion, with the arrival of the 10 millionth foreign visitor recorded in 2023. Regarding Foreign Direct Investment (FDI) flows, the central bank expects them to reach US$4.3 billion by the end of the year. International reserves’ expansion, along with the robust inflows from remittances, tourism income, and foreign direct investment, all contribute to the relative stability of the exchange rate in the Dominican Republic.