The informal currency market in Cuba has experienced its fourth consecutive day of rising foreign exchange rates, highlighting the upward pressure on both the U.S. dollar and the euro, while the Moneda Libremente Convertible (MLC) remains steady. According to the latest reference rate released by elTOQUE on Wednesday, the U.S. dollar is now valued at 415 Cuban pesos (CUP), the euro has jumped to 469 CUP, and the MLC is holding at 195 CUP.
A Week of Surging Currency Values
This upward trend kicked off on Sunday, September 7, when the dollar reached 412 CUP, marking its highest value at that time, and the MLC rebounded to 192 CUP after a decline. By Monday, the euro set a new record at 463 CUP, while the MLC regained the 195 CUP mark, and the dollar held steady at 412 CUP. The trend continued on Tuesday, with the dollar climbing to 413 CUP and the euro hitting 465 CUP, widening the gap between the two currencies. On Wednesday, both currencies surged again; the dollar ascended to 415 CUP, and the euro rose to 469 CUP, achieving their highest recorded values in this market.
The Dollar's Steady Climb
Despite a more gradual ascent compared to the euro, the dollar has shown a consistent upward trend. Since August 28, it hovered around 410 CUP, and over the past four days, it has increased by five pesos, reinforcing the preference of many Cubans for using the dollar in daily transactions.
Euro Reaches Unprecedented Heights
The euro has been the standout in this recent surge. In less than a week, it climbed from 460 to 469 CUP, gaining nine pesos in four days, establishing itself as the most expensive currency in the informal market and a increasingly sought-after safe haven.
MLC: Stable Yet Untrusted
While the MLC remains stable at 195 CUP for the past three days, it is still far from its July levels of 210–225 CUP, underscoring the market's lack of confidence in this state-controlled digital currency.
Understanding the Currency Crisis in Cuba
Why are the dollar and euro rising in Cuba's informal market?
The rise is due to economic instability and a lack of confidence in the Cuban peso, leading people to prefer holding foreign currencies as a safer asset.
What is the Moneda Libremente Convertible (MLC) and why is it stable?
The MLC is a state-backed digital currency used for certain transactions in Cuba. Its stability is due to controlled exchange rates, but it lacks trust from the public.
How have the euro and dollar compared historically in the Cuban market?
Historically, both currencies have been more stable compared to the Cuban peso, with the euro recently becoming more expensive, reflecting its increasing demand.