Press Statement on the Recent Foreign Exchange Market Developments
- The Monetary Policy Committee (MPC) of the Bank of South Sudan (BOSS) met today Tuesday 3′d December 2019. The main issues discuss during the meeting covered the monetary policy for the year 2020 and the recent developments in the foreign exchange
Monetary Policy Targets for 2020
- Deliberated or the Bank’s Monetary Policy Proposals for 2020, which will be recommended to the Board of Directors for adoption, during their next meeting scheduled for the 17° December 2019. In this regard, the Monetary Policy Committee has suggested targets for 2020, which covers targeted real GDP growth for 2020; targeted inflation rate; targeted growth in money supply; and the expected Central Bank Rate (CBR).
Recent Foreign Exchange Market Developments
- The second key agenda item for the meeting was the review of the recent developments in the foreign exchange market and specifically the movement in the exchange rate and the implication this might have on This is the main reason we called for this press briefing. As we all know, the government has recently paid the outstanding salaries to government employees, which is really commendable. However, this sudden payment has its impact on the market, particularly on the exchange rate of the South Sudanese Pounds against USD and other convertible currencies.
- In effect, the Currency in Circulation (CIC) figures, as at September2019, was SSP 48.55 billion. The recent salary payment was about SSP 15 billion. This makes the new injection of cash equal to about 31% of the CIC. This sudden increase is one of the key reason putting pressure on the SSP. If left unchecked, this will lead to higher
- Because of this threat, the Monetary Policy Committee of the Bank of South Sudan, in its meeting this morning has decided to take the following measures:
- The Bank will immediately intervene in the foreign exchange Market:
i. The Bank is allocating significant amount of USD for the Importation of goods and services. This will continue or a regular basis in order to satisfy the market demand for foreign exchange.
ii. We will allocate foreign exchange to Forex Bureaus, which are licensed and compliant with the Bank’s rules and This will be organized on weakly basis, starting immediately this week.
b. The Bank will immediately introduce Term Deposit facilities, which will be available for banks to use and to help them manage access It will be remunerated at reasonable interest rate to be determined by the Bank from time to time.
c. The Bank will introduce Central Bank Bill (BOSS-Bills) to enable it conduct regular Open Market Operations.
- We are confident that we are ready to satisfy the market needs for foreign Let those speculators who want to test our determination to stabilizing the market is take note of our actions.
Dier Tong Ngor
Governor, Bank of South Sudan
Juba, South Sudan