QCOSTARICA – The dollar exchange has maintained an upward trend reaching, this August 10, a new maximum this year of ¢622.85. This, according to the weighted average traded in the Monex market.
The Monex market is for those who trade at least US$1,000.
The upward trend is consistent with seasonal behavior, since generally from April to October are the so-called “dry months” where the price of the dollar tends to rise; However, in the first days of August, there was also a foreign exchange deficit at the banks.
Financial intermediaries generally buy more currency from the public than they sell. When that happens there is a surplus of foreign exchange.
In the first days of August, to the 6th, according to the available information, foreign currency sales by financial entities to the public exceeded purchases by US$11.6 million.
“In general terms, so far this year exchange intermediaries have faced a foreign exchange surplus, which has even allowed the Central Bank to replenish international monetary reserves,” explained Melvin Garita, manager of the BN Valores stock exchange.
“However,” he added, “the first two business days of August were characterized by a relatively strong outflow of foreign currency, which has been decreasing as the days have passed, but which has influenced the behavior of market participants,” Garita commented.
In the foreign exchange market there is supply and demand from both the private sector and the public sector.
In the case of the public sector, the currencies required by the entities are bought directly from the Central Bank reserves and then the entity replaces them in Monex.
This year the monetary authority has sold more currencies to entities than it has bought in Monex. In total, it has sold US$2.045 billion and has acquired US$1.426 billion in this market.
Therefore, in this way, the entity puts less pressure on the exchange rate.
“It is important to note that despite the Central Bank foreseeing an improvement in the inflow of foreign currency from tourism, the equilibrium of the exchange market still depends to a large extent on the country’s ability to access multilateral loans, and foreign savings in general, in which political aspects that affect the perspectives of market participants intercede,” said Garita.
This year the Central Government has received external loans for almost US$700 million and according to the review of the Macroeconomic Program 2021 and 2022 for this year, it is estimated that the Government would receive US$2.661 billion in foreign resources for budget support and US$1.102 billion in 2022.
Garita added that variables such as the electoral environment in which we have entered, the expectations regarding the national and international evolution of the SARS-CoV-2 variants, and the economic recovery of the dollar generators of our country, could be the main factors influencing the exchange rate.