US Dollar Projection in Paraguay: Expected Rise Amidst Global Tensions

The US dollar is projected to rise in Paraguay, possibly reaching ₲ 8,000 by mid-2025, influenced by global tensions and weak soybean prices. Local financial authorities attribute the increase to international factors, dismissing the impact of trade with Bolivia. Overall, the dollar’s upward trend is expected to continue based on commodity price fluctuations and trade uncertainties.

The value of the US dollar is on the rise in Paraguay, even as the Central Bank (BCP) intervened by selling US$ 216 million to local financial institutions to stabilize the currency. Experts forecast that the dollar could reach approximately ₲ 8,000 in the first half of 2025, driven by international tensions and a declining soybean market.

Emil Mendoza, from the Association of Exchange Houses, has identified global conflicts and low soybean prices as critical factors influencing the dollar’s value in Paraguay. He stated, “This is something atypical that occurs because of the international war that is damaging our market, causing the dollar to rise.” He further elaborated that the nation’s soybean production did not meet expectations, adversely affected by poor international pricing due to tensions among major global players.

BCP board member Miguel Mora refuted suggestions that dollar movements towards Bolivia are a significant issue, asserting that trade with the neighboring country is minimal and properly managed. He emphasized, “Unlike with Argentina, we do not have significant trade with Bolivia for this to be a determining factor in the exchange market.” Informal cash transactions were noted as only 5% of total activity, thus not significantly impacting the dollar’s value.

Mora concurred with Mendoza regarding the primary drivers of the dollar’s rise, including decreasing commodity prices and uncertainties in global trade and politics. The escalating trade war between major economies and uncertainties surrounding US policies under President Donald Trump were also highlighted as contributing factors. Although he acknowledged that export revenues might mitigate some pressures later this year, the upward trend of the dollar is expected to continue in the short term.

In summary, the US dollar in Paraguay is expected to rise significantly due to international pressures and a weak soybean market. Experts indicate that political tensions and trade uncertainties are crucial factors influencing this trend, while local authorities maintain that minimal trade with Bolivia does not contribute to the rising dollar value. The dynamics of commodity prices further exacerbate the situation, suggesting that the dollar’s ascent is likely to persist in the near future.

Original Source: en.mercopress.com