Economist Pedro Monreal estimates the “equilibrium” rate for the dollar at 82 Cuban pesos

Economist Pedro Monreal estimated the equilibrium rate of the Cuban peso in relation to the 2022 dollar of 82 Cubans.although it was clarified that it can be subject to variations subject to the applicable methodology, with limitations due to No official open data and in A country where the release of statistics is delayed, incomplete and unpredictable.

In an article posted on his personal blog, state like thisMonreal explained thatThe “balance” rate is an important piece of information because it provides a logical reference About whether the official exchange rate is distorted or, on the contrary, adequately reflects Conditions required for the system to be balanced in macroeconomic terms“.

“Universe The exchange rate is the most important relative rate in an open economy such as the Cuban economyWith so much dependence on foreign relations, economic policy cannot allow itself to be “ignored” with regard to the exchange rate. that it It is reasonable to assume that in Cuba the “equilibrium” rate is officially calculated and updated, but not publicly announced‘, is detained.

In addition, Monreal lamented that ” No other official data open It is forbidden to use most of the current methods so that in an informal manner The “equilibrium” exchange rate in Cuba. “

He explained, “However, one of these approaches can be tested, which would require fewer indicators based on unofficial numbers from the same relatively reliable database until 2020, but this may be inaccurate for later periods. This is the case for the Statistics from the latest report on Cuba published by The Economist Intelligence Unit (EIU) in March 2022.”

“To be credible, the current macroeconomic stability policy must use a sound economic approach. In this sense, the ‘equilibrium’ rate should be an important indicator, even if it is barely mentioned today,” he said.

Monreal explained thatIn addition to the official rate and the “equilibrium” rate, there is a third known exchange rate, the unofficial market rate.. Although it operates in the midst of subjective, speculative and manipulative features, the informal exchange rate deals with the establishment of a certain degree of economic “rationality when official economic policy does not deal with it”.

He added that “the informal exchange rate can record sharp fluctuations in the short term, but it tends in the long run to reflect the dynamics of the ‘equilibrium’ rate.”

“There are countries where the informal currency market is illegal, but where it is not only suppressed, but The central bank takes note of unofficial rates as part of the information analyzed to make economic policy“, pointed out.

“There are various methods for calculating the ‘equilibrium’ rate of change. With a few exceptions, they are data intensive methods and this is precisely a property that limits their application in The case of Cuba, where the disclosure of statistics is delayed, incomplete and unpredictable‘, lament.

Pedro Monreal used the “stock equilibrium” (ES) approach to his calculation, which consists in calculating the exchange rate that corresponds to a state of macroeconomic equilibrium in the medium and long term, a procedure he described as “thrifty” in terms of the data you need; Therefore, it “can be used in a situation like that of Cuba where there is not enough information available.”


“The Break-even rate 82 CUP = 1 USD which has been estimated for 2022 Expresses an approximate number, subject to the “sensitivities” of the given computation variable. It’s not accurate data,” Monreal explained.

He added that this rate “does not refer to the informal exchange market for individual operations, but is derived from calculations that take into account the conditions of macroeconomic equilibrium at the level of the whole economy.”

He continued, “The current informal market rate (which used to fluctuate around a 1 x 100 ratio) reflects the conditions of the individual operating sector and this part of the informal market only.”

According to Monreal’s calculations, The rate of “balance” in 2021 may be 254 CUP per US dollar.

“The marked difference between the estimated ‘balance’ rates for the two years will reflect the changes assumed by the data source (the unit of economic information) that would have occurred in macroeconomic conditions, primarily at the three data level: GDP growth in 2022, lower inflation in 2022, and lowering of inflation in 2022. Relative weight of accumulated debt as a percentage of GDP.

“The results of the calculation are very sensitive to differences in these three data, and therefore, the variance of the real data with respect to the estimates taken from the EIU report can modify the value of the estimated ‘balance’ rate. A calculation that must be updated when the updated data appears,” he said.

For Monreal, “the central point to be kept is that if the official rate remains very unbalanced with respect to the ‘balance’ rate, as is the case with the price of 82 CUP for 1 USD, Risks of macroeconomic imbalancesBecause of its expected negative effects.

Cuba has a national currency (CUP) that is overvalued compared to foreign currencies. For the economist, this “reveals The ‘order’ failed to use exchange rate policy as a tool for macroeconomic management and realistically adjusting relative prices with the aim of improving the country’s international competitiveness.”

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