The President of the Republic, Rodrigo Chaves, referred this past week February 12, to the abundance of dollars in Costa Rica. The Minister of Economy, Industry and Commerce (MEIC), Patricia Rojas Morales, was giving her weekly report when she said that in the country there was an “excess of dollars.”
Then, President Chaves stopped her and corrected her. He told her that in the economy there are no excesses or shortages. “There is never an excess, that is precisely what the price system does, which regulates excesses and shortages by establishing expensive prices when there is a shortage and cheap prices for when there is an excess,” commented Chaves. “We are generating foreign currency like crazy, thank God,” he added.
In conditions of abundance, prices tend to fall, as President Chaves explained, and as is currently the case, when the exchange rate reports values close to ¢509 per dollar. These are prices similar to those reported a decade ago, in 2014.
The president spoke positively about this price
He said that this is why the 400,000 households that have mortgages in dollars are “laughing their heads off.” He also said that this supported the import of 90,000 vehicles, which would not have happened with the higher dollar. The president and the Minister of Economy also spoke about international reserves, which at the end of January reached $14.458 billion, a historic figure. For the minister, this gives the country financial protection.
“We have so many dollars stored in the BCCR as we have never had in history that you can rest assured that there will not be a destructive devaluation here, that from one moment to the next a crisis in the exchange rate occurs. We will maintain stability,” Chaves added.
Less dollar surplus in 2024
The BCCR recently indicated in its Monetary Policy Report that the surplus of operations in the foreign exchange market reached $6,887.3 million in 2024. This is the amount that results from buying supply against demand. Although there is still a surplus, the one in 2024 was smaller than that of 2023, when it reached $7,362.7 million.
The banking entity reported that as a result of market conditions, the national currency registered a nominal appreciation of 2.38%. At the end of the year, the weighted average exchange rate of Monex was ¢511.27, lower than that observed at the end of 2023, when the average was ¢523.46).
Last year, the largest drop in the exchange rate occurred in the first quarter, an effect that was partially reversed in the second quarter. Subsequently, this indicator resumed its downward trend, but more moderately than at the beginning of the year.
