«Foreign currency inflows have contributed to the relative stability of the exchange rate currently observed«.
SANTO DOMINGO.- The most recent outlook from the Central Bank of the Dominican Republic (BCRD) on the Dominican external sector anticipates that the positive evolution of foreign exchange earnings will continue during 2025.
The report states that tourism revenues are projected to reach approximately US$11.3 billion, while remittances are expected to total around US$11 billion. Total exports are estimated at over US$14.8 billion, and Foreign Direct Investment (FDI) is projected to reach approximately US$4.7 billion by year's end.
"All these flows, together with the rest of the exported services, would reach a total foreign exchange income of over US$45.6 billion by the end of 2025," the regulatory body said yesterday in its report on remittances that arrived in the country in the first four months of this year.
It highlights that foreign currency inflows have favored the relative stability of the exchange rate currently observed, so that, as of May 9, 2025, the weighted average selling exchange rate closed at RD$ 58.96, for an appreciation of the Dominican peso against the dollar of 4.0%.
The Central Bank specifies that, in addition to the remarkable performance of remittances, the other variables of the external sector also reflected a favorable behavior, citing that for the January-March period tourism income reached approximately US$3,250.4 million, total exports reached US$3,442.8 million and foreign direct investment (FDI) flows totaled US$1,362.7 million.
"These flows have also contributed to maintaining an adequate level of international reserves, which as of May 9 are above US$15 billion, equivalent to 11.9% of gross domestic product (GDP) and 5.5 months of imports, above the thresholds recommended by the IMF," he emphasizes.
Remittances
The agency reported that remittances received between January and April 2025 reached US$3,917.4 million, a 12.1% increase compared to the same period of the previous year. Specifically, April saw remittances totaling US$954.6 million, an 11.0% increase compared to April 2024.
“These resources sent by the Dominican diaspora abroad are important for development, as they generate a multiplier effect on consumption, investment, and financing for the country’s most vulnerable sectors,” the report details.
The Central Bank of the Dominican Republic (BCRD) highlights that the positive performance of remittances occurs within an international context of high uncertainty, fueled by geopolitical tensions, such as the conflicts in Eastern Europe and the Middle East, as well as by US tariff policies, which have generated fears of a possible escalation in trade wars. “These factors, along with volatility in international financial markets, have affected global growth expectations, causing shifts in capital flows and greater caution among households and businesses, particularly in countries that host migrant communities.”
It argues that in the specific case of the United States, one of the main factors influencing remittance behavior was the performance of some key economic indicators during April, from where 82.7% of the formal flows for the month analyzed originated, some US$724.4 million. It cites that, on the one hand, the overall unemployment rate stood at 4.2%, unchanged from March, remaining close to full employment levels.
“Additionally, it is relevant to consider that, as in the previous month, the diaspora continues to receive a significant proportion of the tax refunds stipulated by the Internal Revenue Service (IRS), which increases its capacity to send remittances. Likewise, these flows demonstrate that, like other Latin American migrants, Dominicans have been increasing their remittances in response to the prevailing economic and immigration uncertainty in the U.S.”
The report adds that, similarly, the Institute for Supply Management’s (ISM) non-manufacturing Purchasing Managers’ Index (PMI) registered a value of 51.6 in April, marking the tenth consecutive month of expansion and showing moderate growth in the U.S. services sector, where a significant portion of the Dominican diaspora is employed.
Countries
The Central Bank of the Dominican Republic (BCRD) also highlights the receipt of remittances through formal channels from other countries in April, such as Spain, which received US$53.8 million, representing 6.1% of the total. Spain is the second largest recipient of remittances from the Dominican diaspora abroad. Italy, Haiti, and Switzerland each accounted for 1.2% of the total flows received. Other countries receiving remittances include Canada and France.
Provinces
Regarding the distribution of remittances received by province, the Central Bank of the Dominican Republic (BCRD) indicates that the National District received 37.5% of remittances in April, followed by the provinces of Santiago and Santo Domingo, with 13.0% and 8.0%, respectively. This reveals that more than half (58.5%) of remittances are received in the country's metropolitan areas.
The Central Bank reaffirms its commitment to monitoring the current economic environment in order to continue taking the necessary measures to counteract the impact on the Dominican economy of the prevailing challenging international landscape, in order to guarantee price and exchange market stability.
