Boliviano devaluation reaches 137% against the dollar | Devaluación del boliviano es de 137% respecto al dólar

By El Diario:

  • The national currency is undergoing a historic depreciation: the parallel dollar is traded at Bs 16.50, practically surpassing double the official exchange rate.
THE BOLIVIANO LOSES VALUE AGAINST THE DOLLAR DAILY..

The boliviano is facing its highest exchange rate pressure in over a decade, as the value of the U.S. dollar in the parallel market surges, creating an unprecedented gap with the official exchange rate.

Although the Central Bank of Bolivia (BCB) maintains the official rate at 6.96 bolivianos per dollar, on the streets the U.S. currency is already being sold at Bs 16.50—more than double the rate set by monetary authorities.

The depreciation of the boliviano against the dollar in the parallel market has reached 137%. This percentage results from comparing the official rate (Bs 6.96) to the parallel one (Bs 16.50), highlighting the scale of the exchange rate crisis the country is facing.

This disparity reflects the growing shortage of dollars in Bolivia’s economy, a situation ongoing since 2023, which has forced importers, businesses, and citizens to turn to the informal market to access foreign currency. According to recent reports, its rate has remained above Bs 16.50 over the past week, while the official rate has remained unchanged since 2011.

President Luis Arce Catacora publicly acknowledged the difficulty of maintaining the official exchange rate and admitted that “it is unlikely the dollar will return to Bs 6.96,” amid a crisis in international reserves and annual inflation already exceeding 18%.

Analysts have warned that the depreciation of the boliviano and the persistent shortage of foreign currency are making imported goods more expensive, especially affecting household spending and productive sectors reliant on external supplies.

The impact of this exchange rate gap is felt across all levels of the economy. The national minimum wage, recently increased to 2,750 bolivianos, is now equivalent to just 166 dollars at the parallel rate, when before the crisis it exceeded 300 dollars.

Economists and international organizations indicated that, if the trend is not reversed, the loss of value of the boliviano could deepen inflation and worsen the social crisis in the short term.

Meanwhile, authorities insist that the official exchange rate will remain stable, even though in practice the dollar can only be obtained in the informal market at prices that reflect the actual state of the Bolivian economy.

The dollar’s rise quickly transfers to domestic prices, especially in an economy like Bolivia’s, where many essential goods and fuels are traded in dollars or depend on imported inputs.

This raises the cost of the basic food basket, puts pressure on inflation, and erodes families’ purchasing power. In border markets, merchants have stopped accepting bolivianos and demand payment in foreign currency, reflecting the loss of confidence in the local currency.

Exchange rate volatility and the shortage of dollars have paralyzed parts of informal and border trade, affecting both importers and exporters. Companies that depend on imported inputs face higher costs and greater difficulty accessing foreign currency, which may lead to reduced economic activity, lower profit margins, and eventually layoffs or shutdowns.

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