Bolivia has abandoned its fifteen-year fixed exchange rate regime, allowing the boliviano to float freely for the first time since 2011.
The central bank set the initial floating rate at 9.73 bolivianos to the US dollar on June 29, a move that immediately devalued the currency against the official peg it had maintained for over a decade.
The decision comes as the South American nation seeks to secure a critical financial lifeline from the International Monetary Fund.
By removing the artificial price floor on the currency, La Paz aims to demonstrate fiscal discipline and market alignment, prerequisites for any potential IMF loan agreement.
The shift signals a significant pivot in economic policy, moving away from state-controlled pricing toward market-determined valuation.
For investors and traders, the float introduces new volatility to a previously stable, albeit mispriced, currency.