Kyat devaluation against the greenback hit approximately K3,600 on 20 February at the Over-the-Counter market.
The Kyat-Dollar exchange rate was K3,500 in early February. The exchange rate showed an increase of around K90 in the past two weeks.
The Central Bank of Myanmar (CBM) intervened in the currency market by selling the dollars into the financial market to steer the dollar gains in the forex market.
The CBM injected over US$59.38 million and 650 million Thai Baht into the financial market in the past 20 days.
The CBM pumped in $13 million on 1 February in the financial market, five million dollars and 50 million Thai Baht on an online trading platform for the exporters/importers on 2 February, $11 million and 200 million Thai Baht on 5 February, eight million dollars on 8 February, $5.38 million on 14 February, nine million dollars and 200 million Thai Baht on 15 February, and eight million US Dollar and 200 million Thai Baht on 19 February.
The CBM sold $68.33 million, 313.5 million Thai Baht and 4.2 million Chinese Yuan in January 2024.
Meanwhile, the reference exchange rate of the Central Bank of Myanmar is K2,100.
Last 5 December, the Central Bank of Myanmar allowed authorized dealers (private banks) to operate forex exchanges freely as per the market rate determined by the market force of the supply and demand.
Additionally, the CBM notified that outward remittance must comply with the rules and regulations of the Foreign Exchange Management Committee.
The dollar gained to around K4,000 on 19 August 2023.
According to the Section 9 of the Foreign Exchange Management Law, only those entities holding foreign exchange dealer licence are allowed to deal in foreign currency and traveller’s cheque. Those holding foreign currencies without valid licence and permits will face legal actions under the law, according to the CBM’s notification released on 21 August 2023.
According to the notification (7/2014) dated 30 September 2014 issued by the Central Bank of Myanmar, affirming stating that under the stanza 15 of the Foreign Exchange Management Law, domestic residents are allowed to keep US$10,000 in maximum or equivalent amount of foreign currencies for six months. If those foreign currencies that have been unused for over six months have to be exchanged in local currency at the market price through the authorized dealers or deposited into bank accounts.
Those illegally holding foreign currencies are to face legal actions under the Foreign Exchange Management Law, the CBM warned again. — NN/EM
