Yemeni rial unprecedentedly depreciates in gov't-held areas

Aden (Debriefer)
2020-06-10 | Since 4 Month

Yemeni rial unprecedentedly depreciates in gov't-held areas

An unprecedented depreciation in the Yemeni rial on Tuesday led to a spike in food prices at market in the official government-held provinces, portending worsened living and humanitarian conditions in the war-torn country.
"The rial selling value in Aden increased to 726 for one US dollar and 191 for one Saudi real," bankers told Debriefer.
According to local merchants, prices of essential foods in Aden markets increased on Tuesday by 20 percent, following the YR decline.
"This increase poses an addition to the burdens already suffered by the public amid a persistent conflict, deteriorated economic conditions and the spread of many diseases including COVID-19," said locals.
The YR has lost 50 percent of its value during the past month, with it depreciation keeping on after the Aden-based Central Bank (CBY) run out of cash reserves in the form of Saudi US$1-billion deposit.
"The local currency's decline can be ascribed to the ongoing conflict between the official government and the Southern Transitional Council, depletion of cash reserves, looted public resources, and the CBY's inability to intervene and control exchange market," banking experts said.
Its suffering from a grave shortage in dollar makes the CBY unable to provide hard money enough for suppliers to import goods, foods in particular, said banking sources at the bank.
For the Yemeni Exchanger Association, the great "illogical increase" in exchange rates has been stemmed from irresponsible speculations in currency and the fact that exchangers follow rumors causing disorder at the market.
The CBY said it is studying all options to stop decline in exchange rates and take strict actions against speculations, holding exchanging firms "fully responsible" for rial depreciation.
Yemen's 5-year-old war has left the country with two different exchange rates; in Aden 726, in Sana'a 604 YRs for one dollar on Tuesday.


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