The Eastern Caribbean Central Bank (ECCB) has reaffirmed its commitment to maintaining the EC dollar's fixed exchange rate with the US dollar, with no plans to alter the long-standing arrangement. According to Antigua.news, ECCB Governor Timothy N.J. Antoine made the confirmation at the launch of the bank's 2026-2031 Strategic Plan on Tuesday, even as the US dollar continues to face significant global headwinds.
Antoine told attendees the currency peg remains on firm footing, with the EC dollar's backing ratio currently approaching 99 percent — well above the legally required minimum of 60 percent.
The EC dollar has been pegged to the US dollar at a fixed rate of EC$2.70 to US$1.00 since July 7, 1976. Prior to that, the currency was pegged to the pound sterling from its introduction in October 1965 before the switch to the US dollar was made.
The reaffirmation comes amid considerable turbulence for the world's primary reserve currency. The US dollar fell roughly 11 percent against a basket of major currencies in the first half of 2025 — the steepest such decline for a first half of a year since 1973. Economists have attributed the slide to uncertainty surrounding the Trump administration's tariff policy and threats to remove Federal Reserve Chairman Jerome Powell, as well as concerns over US fiscal spending and the perceived erosion of the Federal Reserve's independence. Morgan Stanley Research has estimated the US currency could lose a further 10 percent of its value by the end of 2026.
During the question-and-answer session at Tuesday's launch, Antoine acknowledged the global uncertainty, telling attendees the bank is monitoring developments closely. He pointed to the peg's track record of weathering previous shocks and cited the near-full backing ratio as evidence of the currency union's resilience.
A special event examining the peg's history and future is planned for July to mark the 50th anniversary of the arrangement. Deputy Governor Dr. Valda Henry will chair the organising committee.
Antoine has previously noted that the EC dollar's parity value remains unchanged from when the peg was first established, arguing the stability provides confidence to citizens of the currency union while enabling investors to invest, receive returns, and repatriate funds freely.
At the 49th anniversary of the peg last July, the Governor praised the founders' decision to shift from the pound sterling to the US dollar in 1976, noting that the United States had by then become the region's primary trading partner. He credited the arrangement with delivering average inflation of between two and three percent over nearly five decades, outside of pandemic-era disruptions.
