The peso strengthens 8% in 2026: good news or an expensive currency?

The Dominican peso is at its best moment in years: it has appreciated 8% since the end of 2025 and 4.4% year over year. The dollar, which sold near RD$63.50 in January, now hovers around RD$59.74.

For the Central Bank, there is no mystery or artificial intervention: the strong currency reflects an economy receiving plenty of foreign exchange.

What the Central Bank says

The monetary authority stepped to the front of the debate with a technical analysis rejecting that the peso is overvalued. The arguments:

1. The dollar has depreciated 5.28% worldwide since April 2025, so much of the movement is global.
2. Structural sources of foreign exchange — tourism, remittances, foreign investment and exports — support a supply greater than demand.
3. The right tool to measure equilibrium is not the popular Big Mac Index, but the Real Effective Exchange Rate (REER), the Bank for International Settlements standard. And by REER, the peso is aligned with its fundamentals.

The uncomfortable side of a strong currency

Not everything is celebration. Sustained appreciation has three effects felt on the street:

• Exporters find it more expensive to sell abroad: they receive fewer pesos for each dollar they invoice.
• Those living on remittances see the bill arriving from New York yield less.
• Tourism must compete with cheaper destinations in the region.

Importers and households buying dollarized goods — from phones to gasoline — come out ahead.

Why the peso does not shoot up

The currency’s strength rests on an economy with tailwinds: the IMAE grows near 4.7% year over year, international reserves exceed US$15,800 million — equivalent to six months of imports, above what the IMF requests — and the monetary policy rate stays at 5.25%, anchoring price expectations.

The key figure

RD$59.74 per dollar at the end of July, about four pesos less than in January. The debate is not whether the peso is strong — it is — but whether the country knows what to do with that strength.