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Sudanese pound falls to record low on black market

February 14, 2019 at 8:53 pm

Sudanese banknote [Bank of Sudan/Wikipedia]

Sudan’s pound fell to a record low on the black market on Thursday as residents concerned by anti-government protests rushed to buy dollars, traders said, reports Reuters.

The dollar was selling for 70 Sudanese pounds for cash transactions on Thursday morning, compared to 65 pounds at the start of the week, as the gap with the official rate of 47.5 pounds continued to widen.

The price of the dollar for cheque transactions, which is more expensive because of shortages of local as well as foreign currency, stood at 83 pounds.

READ: Sudan hikes flour subsidies by 40 percent to lower bread prices

“There are large shortages,” said one trader who declined to be named. “Also, people are afraid due to uncertainty because of the unrest.”

Sudan has been suffering from an acute shortage of banknotes for months. Many residents have to line up for hours to withdraw money.

The government has been expanding the money supply, mainly through cheques or electronic transfers, to finance generous subsidies, fuelling inflation.

Authorities sharply devalued the currency in early October to 47.5 pounds from 29 pounds to the dollar and established a new system under which a group of banks and money changers set a daily rate. However, the official rate has barely moved.

Since December 19, daily protests, triggered by a worsening economic crisis and calling on President Omar al-Bashir to step down, have spread across Sudan.

OPINION: Sudan’s protest movement is revolutionising youth culture

Protests in Sudan – Cartoon [Sabaaneh/MiddleEastMonitor]