Costa Rica News – The Banco Central of Costa Rica is performing currency intervention which is also known as exchange rate intervention or foreign exchange market intervention. It is the purchase or the sale of the currency on the exchange market by the fiscal authority or the monetary authority, in order to influence the value of the domestic currency.
The monetary authority makes such purchases when there is an excess of dollars in the wholesale market and sell bids to reach the lower limit.
Throughout this week, the exchange rate in wholesale currency markets (Monex) ranged between ¢ 500 and a maximum of ¢ 500.70.
During August, the Central has had to purchase $ 40.5 million to defend the band floor.
According to the brokerage firm Aldesa, there was a decrease in the price of the dollar earlier this week despite buying currencies from state entities.
“The procurement Non-Banking totaled $ 63 million and represented 77% of purchases. While trading volume has been good, the exchange rate does not come off the floor of the band, showing selling pressure generated by the settlement sheets by companies around the 15th of the month, “said Aldesa in a report sent yesterday.
As prices for the public dollar, buying hovered at ¢ 494 and ¢ 505 for sale.
