The Monetary Board announced the Central Bank will be injecting US$50 million of its dollar reserves to stabilize the value of the peso exchange rate. Last week, exchange houses were buying the US$1 for upwards of RD$16. Some exchange houses were reported to be paying up to RD$16.60 for the US$1. The monetary authorities attributed the run on the peso to speculation. Commercial banks are paying about RD$0.50 less on the dollar. The Monetary Board also resolved to freeze the credit to government institutions setting as a ceiling the maximum level of 1998. This limits credit to RD$4,707.8 million, including that available to the Central Government. The Civil Society and business groups have criticized the decision of the PRD-majority Senate of not passing international loans, many of which would be used for reconstruction of infrastructure damaged by Hurricane Georges. Jean Antonio Hach?, of the Organizacion Nacional de Empresas Comerciales, the business organization that groups large department stores, said that the measure affects the availability of US dollars in the money markets.
