Diario Libre newspaper explains that US dollars are increasingly scarce because the exchange houses want the government to lift the RD$20.80 to US$1 ceiling for the purchase of US currency. Removing this limit on currency exchange would break the so-called agreement the government had made with banks and exchange houses last month. The newspaper reports that the exchange houses need the higher rates in order to sell the stock of US currency that was purchased when the dollar hit the record-high of RD$25 to US$1 last November.
The newspaper speculates that the exchange house dealers fear that when the Mejia government carries out the impending US$600-million sovereign bond issuance in international capital markets, the resulting injection of dollars into the Dominican exchange market will force down the price of the dollar to levels even lower than the previously fixed rate of RD$20.80 to US$1, whereby they would suffer substantial losses.
Regardless, the RD$20.80 rate has not attracted US currency to the market and it is believed that those in possession of dollars are sitting on them in anticipation of better days ahead.
Minister of Finance Jose Lois Malkum is quoted in El Caribe newspaper laying blame on the exchange houses for the scarcity of dollars.
