This Thursday, the U.S. dollar reached a record-breaking value of 650 Cuban pesos (CUP) in Cuba's informal market, as reported by real-time tracking from elTOQUE. This marks a historic high for the currency on the island.
The day began with the dollar trading at 640 CUP, but it quickly climbed another 10 pesos to reach this new peak.
Meanwhile, the euro saw an increase, reaching 735 CUP, up by 5 pesos. In contrast, the Freely Convertible Currency (MLC) dropped to 422.45 CUP, falling by 22.45 pesos.
This development aligns with the maximum scenario projected by elTOQUE's Currency and Financial Observatory (OMFi) for the end of June. However, this peak was reached over two weeks earlier than anticipated, as noted in the observatory's monthly report.
The Peso's Decline: A Continuous Trend
The dollar's rise is part of a sustained upward trend, with the Cuban peso depreciating for over 15 consecutive days. June's timeline is telling: the dollar crossed the 600 CUP threshold on June 2, reached 630 CUP by the ninth, hit 640 CUP on Thursday morning, and less than 24 hours later, surged to 650 CUP.
In just the first 10 days of June, the peso lost 50 CUP against the dollar.
Economic Impact on Cubans
Experts consulted by elTOQUE were blunt: "In the short term, the dollar shows no signs of stopping," given the peso's continued weakness and the lack of corrective measures for structural imbalances.
The repercussions for the Cuban people are severe. With an average monthly salary of barely 6,930 CUP, according to 2025 data from the National Office of Statistics and Information (ONEI), a Cuban worker would need almost 94 days of work to purchase 100 U.S. dollars at the informal rate.
A study by researcher Javier Pérez Capdevila estimates that meeting basic needs costs 96,060 CUP per month, equivalent to 14 average wages.
Underlying Structural Issues
The OMFi provides a clear diagnosis: "Most of the economy is at a standstill." The observatory points to several triggers, including the Trump administration's tightened sanctions, the collapse of tourism—down 55.8% year-on-year from January to April 2026, with only 328,608 visitors—the chronic shortage of foreign currency, and unchecked monetary emissions.
In March 2026, the government introduced 2,000 and 5,000 peso banknotes, claiming the need to "facilitate cash transactions," implicitly acknowledging that inflation had eroded the value of circulating cash.
Since 2020, the Cuban peso has lost over 95% of its value against the dollar in the informal market, plummeting from 42 CUP to 650 CUP over six years.
Potential Consequences Without U.S. Negotiations
Symbolic thresholds have been breached at an accelerating pace: 200 CUP in October 2022, 300 CUP in February 2024, 400 CUP in August 2025, 500 CUP in February 2026, and now 650 CUP this Friday.
The OMFi warned that "without a negotiation with the United States, the new phase of isolation will exacerbate restrictions on foreign currency, imported goods, and production inputs, leading to increased scarcity, social deterioration, and inflationary pressures." Economist Elías Amor went even further, predicting that "a conversion rate of 1 to 1,000 may soon be upon us."
Understanding the Cuban Peso's Decline
Why is the Cuban peso depreciating so rapidly?
The rapid depreciation of the Cuban peso is driven by structural economic issues, including a stagnant economy, tightened U.S. sanctions, a significant drop in tourism, and unbacked monetary emissions. These factors have led to a lack of confidence in the peso and a surge in demand for foreign currency.
What impact does the peso's devaluation have on everyday Cubans?
The devaluation severely affects Cubans, as the average salary is insufficient to meet basic needs. With the peso's diminishing value, the cost of living becomes increasingly unaffordable, leading to economic hardship for many citizens.
What measures could stabilize the Cuban peso?
Stabilizing the Cuban peso would require structural economic reforms, increased foreign investment, and potentially negotiating with the U.S. to ease sanctions. These steps could help restore confidence in the peso and improve the country's economic conditions.