Peso is now at RD$53 to US$1

Father Guido

New member
Jul 24, 2022
21
17
3
SDQ
ExPats crying the blues over a drop over of a few pennies makes me laugh. Didn't they get the last raise from their social security check? Is the difference of 57 DOP to 53 going to change your life? Probably not. Can it change the life of the Dominican living in near poverty? Probably yes. Have y'all given this subject some serious thought? Look, there are brighter days ahead . Will the DOP go up and down again? Definitely YES.
for the dollar it's about a 8% drop in 2 years, the euro is closer to an 18% drop; that's not pennies
 

Yourmaninvegas

Well-known member
Feb 16, 2016
2,712
1,921
113
-
for the dollar it's about a 8% drop in 2 years, the euro is closer to an 18% drop; that's not pennies
Of course not, but when you see that the DOP is near historical highs then you should not be making decisions involving fixed monthly payments based on USD strength. That is just poor financial management.

As an example, I made big deals at 58. One time large purchases. That move as paid off. But for perspective when I first moved to the 🇩🇴 the peso was 44. Today it is 53. That is 20.46% increase.

That is free money.
 

JD Jones

Moderator - Covid 19 in DR & North Coast
Jan 7, 2016
7,244
4,579
113
Of course not, but when you see that the DOP is near historical highs then you should not be making decisions involving fixed monthly payments based on USD strength. That is just poor financial management.

As an example, I made big deals at 58. One time large purchases. That move as paid off. But for perspective when I first moved to the 🇩🇴 the peso was 44. Today it is 53. That is 20.46% increase.

That is free money.
Same here. Bought Central Bank CD's up there and made out like a bandit, then the exchange dropped to 33. In one day I almost doubled my money.
 
  • Like
Reactions: Yourmaninvegas
Jan 9, 2004
10,378
1,588
113
Same here. Bought Central Bank CD's up there and made out like a bandit, then the exchange dropped to 33. In one day I almost doubled my money.
Those were the days. If you were lucky enough or bold enough, you did well.

But up to now that has only happened twice since parity circa 1987. And the current move is merely a fraction of the move during the baninter collapse and subsequent IMF bailout.

If history is any guide, the current peso gains are likely to be short lived. The peso has lost 98% of its value since circa 1987.........so in reality the move to hold dollars versus pesos is still the longer term recommended course of action.

With remittances forming a huge portion of and underpinning the the Dominican economy, the dollar decline is a negative headwind for the large number of Dominicans who regularly receive the assistance of and reliance upon dollars or euros.


Respectfully,
Playacaribe2
 
  • Like
Reactions: JD Jones

AlterEgo

Administrator
Staff member
Jan 9, 2009
21,654
4,012
113
South Coast
Those were the days. If you were lucky enough or bold enough, you did well.

But up to now that has only happened twice since parity circa 1987. And the current move is merely a fraction of the move during the baninter collapse and subsequent IMF bailout.

If history is any guide, the current peso gains are likely to be short lived.
The peso has lost 98% of its value since circa 1987.........so in reality the move to hold dollars versus pesos is still the longer term recommended course of action.

With remittances forming a huge portion of and underpinning the the Dominican economy, the dollar decline is a negative headwind for the large number of Dominicans who regularly receive the assistance of and reliance upon dollars or euros.


Respectfully,
Playacaribe2
I hope you’re right. Today we had to send $600 to DR for some work on our house there. BIL said send it today, as it’s about 52-1 and who knows what next week will bring. (He used to run the intercambio department of Banco Central, he’s more informed than most Dominicans).

Not a fortune of a difference, but it all adds up.
 
  • Like
Reactions: Yourmaninvegas
Jan 9, 2004
10,378
1,588
113
I hope you’re right. Today we had to send $600 to DR for some work on our house there. BIL said send it today, as it’s about 52-1 and who knows what next week will bring. (He used to run the intercambio department of Banco Central, he’s more informed than most Dominicans).

Not a fortune of a difference, but it all adds up.
Chairman of the Federal Reserve just this morning reiterated his continued commitment to combat inflation in the US. That likely means another interest rate hike in September of between 50-75bps. If the DR does not raise its rate in lockstep, the appreciation of the peso should begin to neutralize against the dollar. If on the other hand, the DR also raises its monetary policy rate then the appreciation, absent some other factor(s), should continue to gain.

It is literally a proverbial game of chicken going on here. The DR cannot afford to continue to raise its monetary policy rate and risk tanking the domestic economy for the sake of a strong peso. For the moment, those with Dollars to exchange, are feeling what Dominicans have experienced for years as the pesos purchasing power eroded.

Sold a car last year there and reluctantly accepted pesos. As it turned out that has allowed me to utilize pesos on the Island and buttress the effects of the depreciating dollar.

Respectfully,
Playacaribe2
 

Yourmaninvegas

Well-known member
Feb 16, 2016
2,712
1,921
113
-
I consider it a wise policy to hold three months expenses in DOP as a head against temporary losses of strength of the 💵. Those of us that regularly use them for payments can benefit from this.

Markets go up and markets go down.
In the Long Term we are all dead ⚰️‼️
 

Big

Well-known member
Apr 24, 2019
3,369
2,440
113
Chairman of the Federal Reserve just this morning reiterated his continued commitment to combat inflation in the US. That likely means another interest rate hike in September of between 50-75bps. If the DR does not raise its rate in lockstep, the appreciation of the peso should begin to neutralize against the dollar. If on the other hand, the DR also raises its monetary policy rate then the appreciation, absent some other factor(s), should continue to gain.

It is literally a proverbial game of chicken going on here. The DR cannot afford to continue to raise its monetary policy rate and risk tanking the domestic economy for the sake of a strong peso. For the moment, those with Dollars to exchange, are feeling what Dominicans have experienced for years as the pesos purchasing power eroded.

Sold a car last year there and reluctantly accepted pesos. As it turned out that has allowed me to utilize pesos on the Island and buttress the effects of the depreciating dollar.

Respectfully,
Playacaribe2
Yes, that pin head made a comment today and the market crashed.
 
  • Haha
Reactions: Yourmaninvegas
Jan 9, 2004
10,378
1,588
113
Yes, that pin head made a comment today and the market crashed.
The markets definitely had a temper tantrum and did not like that US rates will likely continue to rise.

Countries will be forced to either raise rates or watch their currency depreciate vis a vis the Dollar. That theme is playing out right now with many currencies...............the most obvious victim......the Euro.

But the DR has done a good job, at least as to managing its own monetary policy rate. They would do well to now pare down some of their external debt while they have a strong currency tailwind, but my suspicion is they will not. They likely prefer to maintain their cushion of reserves for the rainy day(s) that are sure to come.


Respectfully,
Playacaribe2
 
  • Like
Reactions: Big

RDKNIGHT

Bronze
Mar 13, 2017
1,658
619
113
what goes up must come down ... also good luck in buying crypto bitcoin is down 68% from its high ...

fyi Rothschild's not a fan of crypto ... long live the dollar
 

Yourmaninvegas

Well-known member
Feb 16, 2016
2,712
1,921
113
-
what goes up must come down ...
Agreed
also good luck in buying crypto bitcoin is down 68% from its high ...
Your comment is confusing me @RDKNIGHT
Is not the idea of investing to buy low and sell high ❓
Or to borrow high sell and then buy back❓
Without being seeming to offer investment advice or advocating crypto it would seem BTC might be a good investment at this point if you inclined to make such of investment.
fyi Rothschild's not a fan of crypto ... long live the dollar
I have read there is research that has been funded that is looking into the feasibility of creating a "digital dollar".

Currency fluctuations affect my cash flow slightly in the short term.
They have improved my buying power in the long term.
But isn't the real value of the 🇩🇴 is that the cost of daily living expenses are lower relative to your country of origin?
 

RDKNIGHT

Bronze
Mar 13, 2017
1,658
619
113
Agreed

Your comment is confusing me @RDKNIGHT
Is not the idea of investing to buy low and sell high ❓
Or to borrow high sell and then buy back❓
Without being seeming to offer investment advice or advocating crypto it would seem BTC might be a good investment at this point if you inclined to make such of investment.

I have read there is research that has been funded that is looking into the feasibility of creating a "digital dollar".

Currency fluctuations affect my cash flow slightly in the short term.
They have improved my buying power in the long term.
But isn't the real value of the 🇩🇴 is that the cost of daily living expenses are lower relative to your country of origin?
I understand buy low sell high theory .... if it was in stocks ... but no one still cant tell me what bitcoin is used for... does jumbo , ikea , mobil, take bitcoin? .. and I own crypto coins ,
 

AlterEgo

Administrator
Staff member
Jan 9, 2009
21,654
4,012
113
South Coast
Agreed

Your comment is confusing me @RDKNIGHT
Is not the idea of investing to buy low and sell high ❓
Or to borrow high sell and then buy back❓
Without being seeming to offer investment advice or advocating crypto it would seem BTC might be a good investment at this point if you inclined to make such of investment.

I have read there is research that has been funded that is looking into the feasibility of creating a "digital dollar".

Currency fluctuations affect my cash flow slightly in the short term.
They have improved my buying power in the long term.
But isn't the real value of the 🇩🇴 is that the cost of daily living expenses are lower relative to your country of origin?
I understand buy low sell high theory .... if it was in stocks ... but no one still cant tell me what bitcoin is used for... does jumbo , ikea , mobil, take bitcoin? .. and I own crypto coins ,
This thread is about dollar to peso
 
Jan 9, 2004
10,378
1,588
113
This thread is about dollar to peso
And there may be a better handle on the direction of the peso vis a vis the dollar, if any, after the CB meets this upcoming week.

If the current 7.75% monetary policy rate starts to inflict too much damage in the domestic economy...........they could even bring the rate down............not likely but certainly possible.

Respectfully,
Playacaribe2
 

Big

Well-known member
Apr 24, 2019
3,369
2,440
113
I just wish they would make it divisible by 10, makes it easier when tipping and making change. Especially after a few martinis
 
Jan 9, 2004
10,378
1,588
113
I just wish they would make it divisible by 10, makes it easier when tipping and making change. Especially after a few martinis
50:1 is pretty easy.............but at 100:1...............it should be a no brainer..........even after those martinis you mention.......but that rate, 100:1, might take another ten years to accomplish.

Respectfully,
Playacaribe2
 
  • Like
Reactions: Big