QCOSTARICA – The exchange rate reports a decrease of 22% so far this year and this trend will continue during the first semester due to the entry of Eurobonds (Eurobonos in Spanish) that were successfully placed this week, several financial analysts confirmed.
The fact that the State does not have to intervene in the local market to seek financing, the placement of Eurobonds and the arrival of more tourists will prevent the exchange rate from increasing in the coming months.
The sell for the U.S. dollar is quoted at around ¢547 on average right now, which is good news for debtors in dollars, especially for the some 700,000 in Costa Rica who earn in colones, but have loans in dollars.
Also, it is a relief for the sectors that import raw materials and inputs in dollars.
Likewise, a more stable exchange rate also benefits the cost of living of families, since 85% of the products that are obtained in the supermarket will maintain their price since many of them are imported.
“This will cause inflation to drop little by little, fulfilling the objectives of the Central Bank, because the exchange rate directly affects the price of fuel and loans in dollars and this means that many people also lower the cost of living in the medium and long term,” Daniel Suchar, an economic analyst, told La Republca.
The money from the placement of Eurobonds for an amount of $1.5 billion dollars will enter the country in five days and will benefit all, since the State will not have to borrow in the local market and with this, it will not put pressure on interest rates, while at the same time, the government will save money, according to the Minister of Finance, Nogui Acosta.
“It is possible that the arrival of a large amount of dollars to the state coffers will cause this to be transferred to the rest of the financial market and would bring the exchange rate down,” said Juan Pablo Arias, an analyst at the Bolsa Nacional de Valores (National Stock Exchange).
However, the good news for the economy in general and for debtors comes at an opportunity cost.
In recent months, the private sector has been demanding actions from the government and the Central Bank for the dollar exchange to increase.
Companies in the industrial sector, free zones, tourism, and exporters, among others, who receive their profits in dollars and have warned that a low exchange rate will translate into economic losses, less investment and even the dismissal of personnel.
“The appreciation of the colon in percentages as significant as those that have occurred in recent months affect exports, tourism and the competitiveness of the national productive sector, especially those that compete in the local market with imported products, particularly MiPyMEs (micro, small and medium enterprises),” indicated Enrique Egloff, executive president of the Chamber of Industries of Costa Rica.
