Cuba Has a New US Dollar-Peso Exchange Rate
Cuba’s Central Bank sets the floating exchange rate at 410 Pesos per Dollar
In addition to the rates of 24 x 1 USD for state enterprises and 120 x 1 USD for tourism, the Government creates a floating rate aimed at capturing foreign currency from the informal market.
HAVANA TIMES – Cuba’s economy woke up this December 18 to a long-announced development, carefully wrapped in the language of “gradualism”: the Central Bank of Cuba launched a third official exchange rate of a floating nature. It begins at 410 pesos per dollar and is added to the existing rates of 24 and 120 pesos to the USD for State enterprises and the tourism industry respectively.
The Government presents the measure as the start of a transformation of the foreign exchange market designed to “bring order” to the economy and move toward a future monetary unification. In practice, the country enters an even more complex stage of exchange-rate segmentation, amid the worst economic crisis in decades.
The president of the Central Bank, Juana Lilia Delgado Portal, defended the decision in a special appearance broadcast on state television and reproduced by the Cubadebate website. She explained that the coexistence of multiple exchange rates has generated “distortions,” encouraged informality, and made banking and fiscal traceability more difficult. Recognizing a third rate—she admitted—responds to an “objective reality” that can no longer be ignored: the enormous gap between official rates and the real value of the dollar in an informal market that today hovers around 440 pesos.
The new scheme divides the exchange market into three segments. The first, at 1×24, will continue to be reserved for centralized state allocations destined for goods and services considered essential, such as fuel, medicines, electricity, public transportation, and the basic food rations. The second, at 1×120, remains in place for certain entities with the capacity to generate foreign currency, particularly tourism. The third—newly introduced—establishes a floating rate that will be published daily by the Central Bank and applied to individuals and private forms of management.
The Government insists that this is not improvisation, but a “responsible” strategy. Immediate unification—officials argue—would trigger a sharp devaluation of the peso, with inflationary effects even more severe than current ones and a greater loss of purchasing power for wages. International experience, authorities repeat, supports transitional schemes with multiple segments in economies burdened by accumulated imbalances.
However, recent Cuban experience invites skepticism. Since the failed Tarea Ordenamiento reforms, launched in January 2021 with similar promises of rationality and stability, the Cuban peso has done nothing but lose value, while inflation soared and real wages collapsed. Four years later, the country not only failed to achieve a currency that could “order” the economy but ended up extending partial dollarization and normalizing an informal market that today sets the real reference for prices.
The Central Bank’s Director of Macroeconomic Policies, Ian Pedro Carbonell, stated that the new floating rate will be based on “real transactions” and not on speculative expectations, as he claims occurs in the informal market. The stated objective is to channel foreign-currency flows through the financial system, offer a legal and transparent space for buying and selling foreign currency, and reduce the risks currently faced by households and businesses.
On paper, the benefits seem clear. Exporters and foreign-currency-generating entities will be able to sell part of their earnings at a more favorable rate than the one currently applied in their accounting, obtaining more pesos to pay wages, invest, and cover internal expenses. Private forms of management will gain legal access for the first time to purchasing foreign currency through their bank accounts, with a limit equivalent to 50% of the average of their gross income over the last quarter. And the population will be able to sell dollars and euros in banks and Cadeca exchange houses at an “attractive” rate, without resorting to the informal market.
But the very design of the scheme reveals its limits. The floating market will sell only the foreign currency it manages to buy. It will not be backed by state reserves or a financial cushion that guarantees stability. In a country with chronically insufficient foreign-currency supply, exports at historic lows, and tourism in free fall, the central question is not how the rate will be set, but how many dollars will actually be available.
The Government acknowledges that the informal market will not disappear immediately. In fact, the gap between the new rate and the street price will be the true thermometer of the measure. If the floating rate remains well below the real value of the dollar, the incentive to operate outside the system will persist. If it comes too close, the inflationary impact will be inevitable.
Added to this scenario is a revealing political context. On the same day as the official announcement, the independent outlet El Toque, which informs daily on the informal exchange market rates, reported that its website had been blocked on the Island following a cyberattack. For weeks, official media and government officials have accused this informational project of “economic terrorism” for publishing the going informal exchange rate. The Government appears to be fighting the symptom—the uncomfortable reference—while being forced to acknowledge the disease: a national currency without credibility.
The BCC’s bet also includes the promise to stabilize and strengthen accounts in the MLC, a virtual currency based on the dollar that the State itself introduced and later hollowed out. Restoring its functionality in retail stores is now presented as part of the new exchange-rate order, although for many Cubans the poorly stocked MLC accepted stores remains a reminder of inequality and exclusion, compared to those accepting US dollars.
Authorities speak of transparency and of continuous information in the coming days. But recent history weighs heavily. Without deep structural reforms, without a real increase in production and exports, and without confidence in the rules of the game, no rate—fixed or floating—can be sustained. The new exchange-rate architecture attempts to impose order on a fractured system, but it does not resolve the underlying problem: a Cuban peso that remains without an anchor in an exhausted economy.
First published in Spanish by 14ymedio and translated and posted in English by Havana Times.