The director of the National Budget Office (Onapres) said that the government expects an average exchange rate of between RD$27-RD$31 to the US dollar for next year. Ruben Pena stated that they had used a rate of RD$37.50 for next year’s national budget in order to gauge income and spending and to have a buffer should anything unforeseen occur. On Monday, Technical Secretary of the Presidency Temistocles Montas had said that the 2005 Budget had been calculated using a RD$37-to-US$1 rate of exchange.
As reported in the Listin Diario, this statement was criticized because it could be interpreted as an indication of the rate at which the government would like the exchange rate to settle. On the same day of Montas’ statement, the peso dropped to RD$31 to US$1, down from RD$27 to US$1 the previous day.
Pena said that the reference rate used by the government does not represent any official expectations of what the rate could be. He said that last year when the budget was designed, the government used a rate of RD$35 to US$1 but the rate went on to climb to RD$55 to US$1. Pena said the difference in rates was one of the factors that led to the suspension of the IMF agreement.