2 Billion US$ return to DR
Article on Dr1 maybe something to do with recent rate drop
Billions of dollars return to DR
Fernando Garcia, the president of the Organization of Commercial Enterprises (ONEC), said yesterday that over the past three months some US$2 billion have returned to the Dominican Republic. Meanwhile, the exchange rate dropped by RD$0.53 yesterday, sitting at RD$31 pesos to US$1, the second such significant stride taken by the Dominican peso this week. Last Tuesday, the dollar fell by RD$0.93 against the peso. Garcia said that the dollars that entered the country belonged to Dominicans who had never intended to remove their funds from the country permanently. It was Garcia's belief that a lack of confidence and worries about a further devaluation of the peso had led many people to acquire dollars as a hedge bet.
According to the ONEC leader, most of this hard currency has entered the banking system, been converted to pesos and has permitted new viability for commercial loans, with interest rates also falling considerably. The Central Bank has lowered its interest rates on certificates to less than 30%, reaching as low as 25% during the latest auction of certificates.
Garcia pointed out that until the actual consumers feel that their personal finances have improved, the local businesses will not feel the effect of the return of this capital. He said that this was why the ONEC had fought against an increase in consumer taxes.
