Tegucigalpa, Honduras.
The reference exchange rate of the lempira against the dollar showed unprecedented behavior in the previous year.
At the end of 2020, the result was an appreciation of 2.11%, which corresponds to 52.20 lempira cents. This means that the price of the US dollar has fallen in the country’s currency market.
According to data from the Electronic Currency Negotiation System (Sendi) of the Central Bank of Honduras (BCH), the reference exchange rate was 24.6498 lempiras per dollar on January 2 this year and 24.1278 at the end of 2020.
This valuation is historic since the BCH reactivated the exchange band system in July 2011.
In 2019, the national currency closed with a devaluation of 1.28%, which equates to 31.18 cents, going from 24.3388 to 24.6506 lempiras per dollar in the Central Bank’s electronic currency auction. As the purchasing power of the lempira increased, the selling price of the US currency fell from 24.82 to 24.29 lempira per dollar.
Behaviour
The result of last year’s exchange rate policy resulted in a positive balance for the national currency, characterized by the negative impact of the coronavirus pandemic and the damage from hurricanes Eta and Iota on the national economy.
However, the final reference exchange rate figure was inconsistent with the projections of several sectors. The BCH survey of macroeconomic analysts in November of the previous year indicated that the nominal exchange rate would close with an appreciation of 1.28%.
In March, when the first cases of covid-19 were recorded in the country, the projections were a devaluation of 1.51%. In the first quarter of 2020, the devaluation reached 12.45 cents, going from 24.6498 to 24.7743 lempiras per dollar in the electronic currency auction, which represents 0.5% in percentage terms.
The global economic crisis triggered by the pandemic allowed key variables affecting the exchange rate to become stronger; among them the balance of net international reserves, which on December 24 of the previous year was $ 8,123.8 million, equivalent to 8.8 months of imports of goods and services.
According to an analysis by the BCH, other factors that contributed to the appreciation of the lempira are the behavior of the exchange rates of Honduras’ main trading partners, as well as the rate of inflation.
It emphasizes that the participation of the banking system in the foreign exchange market was key to meeting the dollar demand of the various economic actors, instilling confidence in the exchange rate policy.