16 August 2012

Sudan Devalues Currency As Black Market Rate Goes Up

Khartoum — The price of the U.S. dollar in Sudan's black market for hard currency jumped on Thursday to 5.95 as the country's central bank further devalued the local pound in renewed efforts to plug the gap with the unofficial trade.

Sudan has been struggling to narrow the gap between the official and black market rates of foreign currency exchange which has been widening since the country lost its main source of hard currency revenues due to the secession of the oil-rich South Sudan last year.

In May, the Central Bank of Sudan (CBS) allowed government-licensed Forex bureaus to determine their own rates in buying and selling currencies in an effort to curb the flourishing black market but the situation changed little as Forex offices kept hiking their rates to match value in the unofficial trade while failing to meet the demand due to the small supply they receive from CBS.

CBS announced on Thursday that it was fixing a new exchange rate of 5.65 for commercial banks and Forex bureaus alike in order to narrow the gap with the black market rate. CBS said the new rate will be followed by decreasing it to 4.4 following the Eid holiday.

Sudan Tribune has learned that commercial banks already started using the new rate but there is no information on whether Forex offices did too.

Meanwhile, the black market rate increased to 5.95 after it went down last week on news of the new oil deal between Sudan and South Sudan.

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