The value of the Euro reached a new high of 290 Cuban pesos (CUP) this Saturday, marking the highest figure ever seen on the Island. This increase is just a preview of what could happen when, starting February 1, the Government applies the increase in the price of fuel and the dollarization of its marketing, which is the star measure of its announced economic package.
Independent media outlet, The Touch, has reported that the US dollar is now trading at 284CUP, also a record high. The MLC has remained at 250CUP for days, according to reports. The CUP was exchanged at 265 per dollar on December 31, and in 27 days of January it has depreciated by 19 pesos. These rapid fluctuations in currency exchange rates are indicative of the economic challenges facing Cuba, including skyrocketing prices of consumer goods and the free fall of the purchasing power of the Island’s inhabitants.
Academic Steve Hanke recently reported that the CUP has experienced a fall of 37.09% since January 2023, making it the 12th least valuable currency on the planet. This comes after the regime announced the application of a significant economic package that will raise rates for services and substantially increase the price of gasoline and diesel, as well as the dollarization of their sale.
Inflation in Cuba, according to official figures, closed 2023 with a year-on-year increase of 34.34% in the formal market. The consumer price index (CPI) also increased by 3.39% in December compared to the previous month. Prices for food and the rates charged by transporters have also risen, further exacerbating the economic challenges faced by the people of Cuba.