Costa Rica's Dollar Boom Leaves Workers Exposed

Companies in Costa Rica’s special trade regimes generated about 94.5% of the private exchange market’s net dollar surplus in 2026, while households earning wages, pensions or remittances in dollars lost purchasing power as the colón strengthened. The Central Bank can step into the market, but the dollars flooding it come chiefly from export businesses operating in free trade zones.

Who Sets the Exchange Rate

Costa Rica recorded average daily dollar supply of about $152.9 million so far in 2026, up from $134.9 million over the same period in 2025. Daily demand also rose, from $108.1 million to $122.3 million, leaving a surplus of about $30.6 million.

From January through August, companies in special trade regimes sold about $5.2 billion in foreign currency and bought $471 million, for net sales of $4.73 billion. Those firms earn dollars exporting medical devices, electronics and business services, then sell some of them to cover salaries, suppliers and taxes in colones. The added supply puts downward pressure on the exchange rate.

The weighted average rate in the Foreign Currency Market, or Monex, closed Friday, Oct. 30, at ₡452.08 per dollar. That was about 35% below the record ₡696.76 set June 21, 2022. A stronger colón makes imported vehicles, electronics, machinery, raw materials and fuel cheaper in colón terms, and borrowers earning colones but owing dollars face smaller local-currency payments. But hotels, tour operators, exporters and agricultural producers receive fewer colones for each dollar earned; households with dollar incomes also lose purchasing power when they convert those earnings.

The Central Bank bought about $5.21 billion in Monex during the period covered by its October report, or 63.4% of the amount traded. Its purchases covered stabilization operations, reserve accumulation and foreign-currency needs of the nonbank public sector. On Tuesday, Oct. 27, Monex recorded $153.4 million in trading, its largest single-day volume in Central Bank records. The bank bought $52 million through stabilization operations and another $62.7 million for public-sector requirements.

The Apparatus Has a Long Reach

The Central Bank’s board approved the end of controlled devaluations on Oct. 13, 2006, and the reform took effect four days later. The crawling peg, used since 1984, had allowed the bank to adjust the exchange rate in small daily increments, steadily weakening the colón against the dollar. The reform introduced an exchange-rate band, with the Central Bank intervening at its ceiling or floor.

Costa Rica moved to its current managed float in February 2015. Supply and demand now mainly set the rate, although the Central Bank can intervene to prevent sharp swings. The change also cleared the way for the bank’s inflation-targeting framework, formally adopted in 2018. On Friday, Oct. 30, Central Bank President Róger Madrigal revisited the reform while presenting the institution’s October Monetary Policy Report.

A stronger colón helps contain inflation through lower import costs, but that relief sits alongside losses for people paid in dollars. Foreign direct investment reached about $2.74 billion in the first half of 2026, 23.4% more than in the same period of 2025, according to a Foreign Trade Promoter analysis based on preliminary Central Bank data. The United States accounted for roughly 69% of investment. The figure excludes Heineken’s acquisition of FIFCO’s beverage, food and retail businesses, an extraordinary transaction that dominated first-quarter flows.

Ballots, Tariffs and the Household Bill

The U.S. midterm elections scheduled for Nov. 3 will choose all 435 House of Representatives members and 33 of the 100 Senate seats. Republicans control both chambers, but the ballot doesn’t automatically unwind the 12.5% tariff Washington applies to many Costa Rican goods. The tariff took effect July 24 after investigations the Office of the U.S. Trade Representative opened in March under Section 301 of U.S. trade law. Coffee, pineapple, bananas, orange juice, plant cuttings, fruit and vegetable seeds, and certain refined sugars are excluded, according to the Ministry of Foreign Trade, or Comex.

International relations analyst Carlos Murillo said President Donald Trump could use other legal instruments to maintain his trade policy, and that a new congressional majority wouldn’t automatically reverse measures affecting Costa Rica. Analyst Nuria Marín said a Congress with more Democrats could increase oversight of the president, especially on trade, but lawmakers couldn’t block everything because many decisions rest with the executive branch. Both analysts said policies directly affecting Costa Rica—including tariffs, migration rules and security cooperation—would continue to be shaped largely by the White House regardless of the election outcome.

A different kind of response appears in a Tico Times opinion column by Don Mateo: a 700-square-meter garden in a barrio of San Isidro de el General, with an avocado tree, banana tree, chayote vine, lemon tree, pineapples, mint and oregano. The writer said the plants grew without lab-derived chemicals and argued that Costa Rica’s growing conditions could support home gardening. The column contrasted that plot with large-scale agriculture, alleging that multinational firms convert large areas into monoculture farms and that banana and pineapple plantations use chemicals including mancozeb, glyphosate and ethoprophos. Don Mateo described a southern-zone town surrounded by Del Monte pineapple plantations, where almost everyone worked for the company, pay was minimal and laborers had a free clinic amid long hours in hot sun and regular chemical exposure. No organized mutual-aid effort appears in the account; the garden is the concrete example of food grown outside that export-farm system.