Euro Hits Record High Against Cuban Peso in Informal Currency Market
The Euro (EUR) reached a historical maximum on Monday, March 25 in the informal currency exchange market in Cuba, with predictions indicating that its value will continue to rise against the Cuban peso (CUP).
The representative exchange rate offered daily by non-state media El Toque placed the value of the European currency at 336.00 CUP, a trend expected to continue throughout the week. The United States Dollar (USD) and the Freely Convertible Currency (MLC) are also experiencing a similar upward trend, reflecting the difficult economic situation on the island.
The USD maintains its price of 330 CUP, while the MLC has a value of 275 CUP. The MLC saw a substantial increase in the Cuban informal market at the end of last week, rising from 270 CUP to 275 CUP.
According to El Toque, the values are based on nearly 2,000 currency trading advertisements published daily on various websites in Cuba, from which the media establishes its “Representative exchange rate in the informal currency market.”
The devaluation of the CUP continues to worsen, with experts attributing the situation to the new economic measures implemented by the Cuban government. The increase in prices of essential goods and services, coupled with existing shortages in state markets, has led to a significant rise in inflation.
The National Office of Statistics and Information (ONEI) reported a 32% increase in inflation so far in 2024, while some international economists suggest that the actual figure could be much higher. There are conflicting reports on the real inflation rate, with American economist Steve Hanke estimating it to be around 76%.
The depreciation of the CUP, which has lost almost 46% of its value against the USD since January 2023, further validates concerns about the economic stability in Cuba. The continuous rise in foreign currency values and inflation rates paint a grim picture for the Cuban economy.