At a request bythe Central Bank of Yemen (CBY), Saudi financial authorities have approved the 26th withdrawal of US$ 136 million from Saudi depositat CBY in Aden, seat of the Yemeni official government.
With exchange rate of 440 rials for one dollar, the sum is meant to cover demands [of hard money] applied for by traders at local banks across Yemen to import essential supplies, the CBY saidSunday in a release.
The CBY called on all commercial and Islamic banks, that have received consents to their clients' LCs, to appear at the CBY branches to finalize the opening of documentary credits and deposit and exchange 100 percent of the LCs' value in Yemeni rial, within five days, after which the exchange rate would be 506 rials for one dollar.
The bank set exchange rate for goods imports at the rate of 506 rials for one dollar (excepting for essential supplies covered by the Saudi deposit, for which rate is still 440).
This action aims to "ensure the provision of different commodities at all markets at normal prices," the CBY release read, following the "Houthi persistent speculation on currency."
On April 11, the CBY said it would meet suppliers' all needs of foreign currencies at the least market rate for import purposes.
Earlier, the bank had set exchange rate for goods imports at the official rate (440 rials for one dollar) applicable since last December, but it has increased at market to 570.
Having the 26th installment approved, a total of US$ 1.21 billion has been withdrawn from the Saudi deposit so far to cover LCs for food importation.
The CBY has foreign cash reserves of more than US$ 3 billion, in the form of a Saudi3-billion deposit and a Saudi 200-million grant.
Yemen imports some 90 percent of its food needs, including most of its needs of wheat and all its needs of rice.
The Aden-based CBY is securing the hard money for suppliers to open documentary credits (at exchange rates lower than those at the market) and import food supplies.