Very Strange Exchange

Simon & Nicky

Bronze
Feb 3, 2004
655
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www.simon-hall.co.uk
Get your heads around this - answers on a postcard please.....

Changed 1000 dollars yesterday afternoon (Saturday 17th) at the little exchange shop almost opposite PJ's in Sosua. Rate was 42.50.

The accepted global exchange rate since close of trading Friday evening (rates tend not to change over the weekend) was 42.00 see http://www.bloomberg.com/markets/index.html

The exchange kiosk must have known the rates: They had all the info they needed since the day before so why undersell yourself by a minimum of 500 pesos? And let's face it - surely you would want to make a small profit on each transaction so I would say they have undersold by at least 1000 pesos.

The only reason I can think of is that they know that the dollar / peso rate is going to drop like a rock next week and consequently they want to be holding as many dollars as possible at any cost. Is this what they call a conspiracy theory? ;)

Simon
 

Gringo

Bronze
Jan 1, 2002
1,314
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Hummmmmmm

Simon & Nicky said:
Get your heads around this - answers on a postcard please.....

Changed 1000 dollars yesterday afternoon (Saturday 17th) at the little exchange shop almost opposite PJ's in Sosua. Rate was 42.50.

The accepted global exchange rate since close of trading Friday evening (rates tend not to change over the weekend) was 42.00 see http://www.bloomberg.com/markets/index.html

The exchange kiosk must have known the rates: They had all the info they needed since the day before so why undersell yourself by a minimum of 500 pesos? And let's face it - surely you would want to make a small profit on each transaction so I would say they have undersold by at least 1000 pesos.

The only reason I can think of is that they know that the dollar / peso rate is going to drop like a rock next week and consequently they want to be holding as many dollars as possible at any cost. Is this what they call a conspiracy theory? ;)

Simon

I wonder myself what is happening, Where I work we get paid every friday in US.$
This Friday we had three different exchange houses bidding each other for our US. $Top bidder payed 43.10.........Something's up.
 

Chris

Gold
Oct 21, 2002
7,951
28
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www.caribbetech.com
Interesting - I had a feeling all last week that something is not as it seems - the slow downward movement was just too 'ordered' and 'organized' to be real. Looks like an exciting week ahead for those with and without pesos.
 

ricktoronto

Grande Pollo en Boca Chica
Jan 9, 2002
4,837
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I would not recommend living or dying by the rates you find online such as Oanda, Bloomberg, Yahoo!, etc. (For US, Euro, CDN, Stg, etc., sure)

They are far more stable that real markets and really don't reflect the local markets, particularly in such an illiquid currency on world markets as the DR peso. It was stuck at 46.2 on Yahoo (which sources its rates from somewhere else) for the whole time we were getting 50 -55 to the US$.

Local supply and demand dictates the rates. Given the horrible state of the DR economy right now, the improvement from 48.3 when I was there in May to 42 +/- something now makes no sense at all.
 

Simon & Nicky

Bronze
Feb 3, 2004
655
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www.simon-hall.co.uk
I don't agree...

Bloomberg has been very acurate (at least over the last week). I've tracked the rates daily and watched them slide over the last week or so from 47 when I could only get somewhere around 44 or 45 on the street to today's rather odd 42 where I would expect around 39 or 40 and got 42.5.

I guess only time will tell..........


Simon
 

Riu

New member
Jun 11, 2004
202
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This is in line with the president-elect taking power. The previous goverment was plagued by instability. The change of power to a more, should I say, smarter president, in the dealings with international goverments and private sector would incur a change in exchange rates from previous situation. Supply and demand are not the only powers that influence a currency. Percieved stability will have an effect on currencies until the time when measures and positions taken by new goverments take effect positively or negatively. Its sort of like when trade defecit and unemployment figures como out every month, they have and effect positively and adversely to the currency exchange rate. The change of power in DR in perceived as a good thing hence the exchange rate's tendency to drop. Not to say that it may continue to drop or that it may go back as high as RD60, it is just to say that currently that is how it is perceived.