Economy May 10, 2020 | 8:13 am

The US dollar breaks the 56 pesos to one dollar barrier in Dominican Republic

SANTO DOMINGO. The US dollar is preparing for an opening of the week, trading above 56 pesos to one US dollar, with the aggravating circumstance that those who need more than two thousand dollars have to use extra-market mechanisms and pay more than the cash price.

Banks are buying the US currency around 55.5 pesos for one dollar and sell it between 56 pesos and 57 pesos per dollar, the highest price since the country’s banking crisis in 2003.

The closure of tourist activity, the reduction of remittances by more than 20 percent, and the decline in exports have produced a significant drop in the number of dollars entering the national market as a result of the measures adopted by the Dominican government. and other countries to contain the spread of the new Covid-19 coronavirus.

This situation has been offset to some extent by the reduction in the consumption of exported goods and products, the drop in the oil bill, and the disbursements of various international loans.

The World Bank has already announced the disbursement of US $ 150 million, while the International Monetary Fund has authorized a loan of US $ 650 million, which is expected to continue containing the internal exchange market.

Commercial banks maintain the policy of limiting the sale of dollars only to their customers and up to a limit of two thousand dollars in window sales. More than that amount has to be authorized by a bank official depending on availability and commitments.

The average rate of the Central Bank for dollar transactions in the financial system is 55.28 pesos per dollar for purchase and 56.25 per dollar for purchase. A month ago the average was 55.17 for sale and 56.1 for sale; while a year ago the average was 50.14 for sale and 50.55 for purchase, which implies an annual devaluation of the currency of 10.14 percent.