Expat retirees and exporters are hopeful as the colon exchange rate continues to climb.
The rate, which has been stagnant for months started to climb last week when the U.S. Federal Reserve reduced the amount of bonds it would buy in February by $10 billion. The U.S. central bank had been purchasing $85 billion in bonds a month to put new money into the economy and encourage growth.
Of course, that also suggested that the dollar was becoming worth slightly less every month. The Fed expects to eliminate the subsidy in December.
The Banco Central de Costa Rica reports that the average cost of a dollar Monday was at 524.82 colons and those who sold a dollar could receive 510.15. The figures were about 3.5 percent higher than earlier in January. The dollar is traded in a local exchange with the Central bank supporting it or the colon if prices get out of line.
Exporters who receive payment in dollars and have to pay bills in colons have been complaining. That also was true of expats who receive dollars from abroad to pay expenses here.
Of course, the dollar has been as high as 575 colons before the recent economic crash.
In Washington, the new head of the U. S. Federal Reserve, Janet Yellen, was sworn in Monday. Ms. Yellen had been the vice chairwoman of the Fed and is the first woman to lead the central bank in its 100 year history.
Some economists say Yellen’s approach is likely to be similar to that of former chairman Ben Bernanke, who pushed interest rates to historic lows as one part of the effort to pull the economy out of a slump.