Costa Rica News – The Central Bank of Costa Rica raised the ceiling of the exchange rate of the dollar to ¢800.5 today. There should be no immediate changes as far as the actual purchasing power of the dollar, however.
The exchange rate in Costa Rica between colones and dollars is on a “band” system, with both a lower band and an upper band, or a “floor” and “ceiling.”
The exchange rate all year has remained around the “floor” of 500 colones to the dollar. Those who have a salary or savings in dollars should not get their hopes up.
Experts say that the change is in effect only to reassure the economy, specifically sectors like exportation. It will most likely not affect the actual exchange rate.
The experts really believe that the colon will weaken over time against the dollar, thus negating the need for a ceiling altogether. When the dollar’s purchasing power increases over the colon, the exported products will be cheaper and more attractive on world markets.
The point of the raised ceiling is to assure sectors like exportation that there is room in the long term for the devaluation of the local colon.
