Central Bank blames strong dollar for rising prices
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Myanmar had to bear the brunt of a six-per cent currency depreciation against the US dollar, said Set Aung, vice-governor of the Central Bank of Myanmar, at the launch of the European Chamber of Commerce seminar in Yangon on December 12.
The kyat’s depreciation against the US dollar was less severe than that of Myanmar’s neighbours, he said. Since the beginning of October, Myanmar kyat’s decline had been six per cent while the Thai baht sunk by nine per cent. Likewise, India’s rupee slumped by 16 per cent with Indonesia’s rupiah tumbling by 28 per cent, he added.
Due to the economic crisis in 2007, the greenback’s depreciation had impacted many countries, including Myanmar.
The dollar appreciated to Ks 1054 on November 20 from Ks 980 in the early October. And the export earnings per dollar rose to Ks 1080. Accordingly, the CBM warned the private banks to sell and buy the dollar within its reference range of +/- 0.8 per cent, stabilising the dollar price. The dollar-buying price at the private banks went down to Ks 1035 on November 28 and Ks 1054 on November 20.
A fall in the value of the dollar is Ks 20 on average, causing a 15 per cent increase in the value of basic commodities.
According to the CBM’s reference rate, the value of a dollar stood at Ks 1025 on October 22. The dollar increased by around Ks 200 from the CBM’s reference rate of Ks 825 set in April 2012.
