Dominican Republic speculative ‘bubble’ spooks the dollar

Santo Domingo.- Centralbanker Hector Valdez Albizu on Wednesday blamed the scarcity of dollars on "asort of speculative bubble in the foreign exchange market" partly a resultof "the volatility of international markets around the effects of Brexit."

Valdez’s statement comes in response to a denunciation by AntonioTaveras, president of the Herrera and Santo Domingo Province Industries Association(AEIH).

On June 29 however the Central Bank said in a statement that"the process of Brexit does not significantly affect the Dominican economy."

Earlier this week Taveras denounced a shortage of dollars inthe local market. He also demanded that the authorities determine "who’s hoardingdollars."

The business leader said the country needs a convincing responseon what’s occurring in the forex market to retain the economic agents’ confidence.

As of last Friday financial institutions sold dollars forRD$45.97, but climbed to RD$46 on Monday.

When outlet diariolibre.com asked about the dollar’sbehavior in the market, Central Bank International Dept. director Rafael E.Capellan said: "The banking market is oligopolistic," in which they"may agree," adding that "You know that it’s three banks thathandle the bulk of operations in the country."