Massive deterioration of Sudanese pound and wide dollar scarcity

Altaghyeer: Khartoum

On Wednesday the Sudanese pound underwent awful deterioration and its value dropped to 65 pounds against the US dollar in cash and around 75 pounds for check transactions.

A currency dealer told “Altaghyeer” that “the recent surge is dangerous and signals a continuous retreat for the pound in the coming days”.

The US dollar bounced from 58 pounds last Saturday to 60 pounds on Sunday afternoon, and dealers informed “Altaghyeer” that the dollar’s price for selling on credit reached 68 pounds.

Since last week authorities embarked on an extensive crackdown on dealers and detained a number of them as they pointed out the diminished supply of hard currency especially the US dollar, a matter that would certainly lead to the hiking of commodities’ prices. Some of the dealers went on to speculate that prices will exceed 65 pounds for cash and go beyond 75 pounds in check transactions by the end of the week.

A number of economists criticized the security raids and seizures approach, pointing out that it will only result in scarcity and more surges in dollar prices.

In the meantime the prime minister, who is acting as a finance minister at the same time, outlined his government’s priorities which included lowering inflation, raising the Sudanese pound’s value against the US dollar and the provision of hard currency.

On October 7th the government established a body tasked with determining and announcing the official exchange rate, which became known as “market makers’ mechanism”. The new body failed in matching the market’s price and didn’t announce its own prices for more than a week, which stood at 47.5.

Sudan is currently going through an unprecedented economic regression, paucity of fuel and bread and higher commodity prices. Additionally, the country is suffering a deep liquidity crisis which is justified by the government as a means to control the exchange rate.

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