Severe economic crisis with 60 percent erosion in Myanmar's currency

Rangoon: Myanmar's economic crisis has worsened since the coup and its currency, the kyat, has depreciated by more than 50 per cent so far in September. Food and fuel prices have skyrocketed in a shattered economy following a military coup eight months ago.

"Myanmar's economy has been shaken since the coup and the Kyat rate as a border barometer has been severely affected," said Richard Horsey, an expert with the International Crisis Group.

In August, the Central Bank of Myanmar tried to keep the reference rate of its currency, the kyat, at 0.8 against the dollar, but pressure on the exchange rate mounted and efforts were thwarted on September 10.

There is such a shortage of US dollars that some money changers have closed its shutters.

Money changers posted on social media that all Northern Breeze Exchange Services branches have been temporarily closed due to currency rate volatility at present.

Traders who are still operating were offering an exchange rate of ક 500 per US dollar on Tuesday, up from ૬૯૫ 12 on September 1 and ૩૯૫ 15 on February 1, when the democratically elected government led by Nobel laureate Aung San Suu Kyi Was put to the test.

Myanmar's central bank has not disclosed how much foreign currency it has sold, but according to World Bank figures, it had reserves of only ૬૭ 4.5 billion at the end of 2020. However, out of its capacity, the central bank has spent ૫ 25 million on buying kyat between ૩ 150 and ૭૫૫ 12 per dollar between September 16 and 7.