American Expatriate Costa Rica

Costa Rica Central Bank Abandons Currency Bands for “Float”

Costa Rica Central Bank (BCCR) announced over the weekend that it will eliminate the system of maintaining an exchange rate floor and ceiling, and allow the exchange rate to “float”. A press release from the bank said that it had not intervened to change the value of the colon, outside of the bands since December of 2013.

Also according to the bank, it has an internal policy that provides,

exchange stabilization mechanisms that seek to limit excessive volatility intra daily and correct deviations exchange rate relative to that would be consistent with the behavior of the variables that explain their tendency medium and long term.

The bank also released that it has presently $7.3 billion in USD reserves. The figure is equal to 14 percent of GDP.

Source Banco Central de Costa Rica