Bolivia adopts flexible exchange rate, ends 15‑year dollar peg

Bolivia’s government approved a resolution ending a 15‑year fixed dollar peg and moving to a flexible exchange‑rate regime. The official rate was set at 9.73 bolivianos per U.S. dollar, about a 30% devaluation from the previous 6.86‑6.96 level, and will be updated daily based on weighted averages of bank transactions.

The shift aims to restore macro‑economic stability, improve the balance‑of‑payments and preserve external competitiveness as foreign‑exchange reserves have fallen and a parallel market where the dollar reached near 20 bolivianos has expanded. The central bank will oversee the transition, keeping a narrow ceiling on sell‑rate margins.

Former President Evo Morales denounced the change as a “hidden devaluation” that will hurt families and pension funds, while Economy Minister José Gabriel Espinoza said the flexible regime will not alter much and expects a good supply of dollars this year. Vice‑president Ed Mara Lara warned that a market‑driven rate without fiscal backing could accelerate inflation and erode purchasing power.

The International Monetary Fund had recommended ending the peg and Bolivia is negotiating a financing program of roughly $2.5‑$3 billion. Labor blockades that began in May have continued, demanding higher wages and questioning IMF‑linked reforms.