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Dollar continues to fall against Paraguayan guarani after long weekend
🇵🇾 Paraguay /Economy & Trade

Dollar continues to fall against Paraguayan guarani after long weekend

From ABC Color · () Spanish

Translated from Spanish, summarized and contextualized by DistantNews.

At a glance

News Named sources Context piece
  • The US dollar continued its decline against the Paraguayan guaraní, trading around G. 6,100 at the start of the week.
  • This downward trend is causing discomfort in some economic sectors, which are calling for central bank intervention to stabilize the exchange rate.
  • The Paraguayan central bank attributes the dollar's fall to global trends and increased foreign currency inflow from investments and exports.

The US dollar continued its downward trend against the Paraguayan guaraní, opening the week's trading sessions with a further retraction. The exchange rate hovered around G. 6,100, reinforcing the bearish movement in the local market following a long holiday weekend.

the dollar registered a quotation of G. 6,120 in effective exchange, below G. 6,140 that it quoted at the close of last Thursday.

— ABC ColorReporting on the specific exchange rate movement at the start of the week.

On Monday, the dollar was quoted at G. 6,120 for cash exchange, down from G. 6,140 at the close of the previous Thursday. The interbank exchange rate also saw a pronounced drop, settling at G. 6,098 according to the Central Bank of Paraguay's (BCP) average. So far this year, the dollar has depreciated by 9% against the national currency, with an annual variation reaching 25%.

the trend also intensified downwards and was quoted this Monday at G. 6,098, according to the average published by the Central Bank of Paraguay (BCP).

— ABC ColorDetailing the interbank exchange rate's performance.

This sharp decline in the dollar's value is creating unease in various economic sectors. Exporters are receiving fewer guaraníes for their shipments, impacting their revenue. Furthermore, the competitiveness of Paraguayan products compared to regional counterparts is affected. Customs revenue is also feeling the pinch, as the lower dollar-to-guaraní conversion results in less income than anticipated by the treasury.

the dollar has accumulated a depreciation of 9% against the national currency, while the annual variation is 25%.

Quantifying the extent of the dollar's depreciation against the guaraní.

These sectors are urging for greater intervention from the Central Bank to curb the volatile fluctuations in the exchange rate. However, the BCP maintains a neutral stance on its exchange rate policy. The bank attributes the dollar's fall to global trends and a significant inflow of foreign currency driven by a recovery in investments and exports. In a recent statement, the BCP reiterated its recommendation for economic agents to utilize exchange rate hedging mechanisms, such as forwards, to mitigate the effects of the dollar's depreciation.

the fall of the dollar is not only affecting exporters who receive less income when converting shipments to guaraníes, but it is also impacting the competitiveness of national products compared to others in the region.

Explaining the broad economic impact of the declining dollar.
DistantNews Editorial

Originally published by ABC Color in Spanish. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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