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Could The Dollar And Peso In The Dominican Republic Be At Risk Of A Currency Crisis?

Could the dollar and peso in the Dominican Republic be at risk of a currency crisis?

Could the dollar and peso in the Dominican Republic be at risk of a currency crisis?


Economist Magín Díaz said on Friday that there is no risk of a currency crisis because the Central Bank has 15 billion reserves and has credibility.

“Héctor Valdez Albizu comes out one day and says 'this is not going to move,' and it is not going to move because he controls expectations,” he explained.

Díaz, former head of the General Directorate of Internal Taxes, understands that the Central Bank manages the situation of the dollar in the country.

“There is never a shortage; If you go to look for it there is always a price at which the Central Bank sells it at a higher price now, with the exchange rate what it does is that it tries to make the price move slowly,” he said.

The expert revealed that “the Dominican economy grew the same as the Latin American average, in the last 30 years, let's say we grew twice as much. “It is now the lowest growth in about 30 years.”

He maintained that the country's finances are robust because “in a bad year we grow the same as the average.”

“The Government made a reformulated complementary budget where it increased the deficit to 221 billion pesos, but the preliminary results indicate a deficit close to 210 billion pesos, that is, a little less than the complementary budget,” he said.

Regarding the increase in rates for this year, he indicated that the Central Bank lowered the reference rate and gave liquidity to the banks so that they could lend at a fixed rate for a couple of years at a lower rate than what they had. Rates here could decline further if the United States lowers its rate.

These statements were made on the program El Sol de la Mañana, broadcast by Zol 106.5 FM.

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