AUCTION-Volume Increases to 13M USD-BOSS
By William Madouk Garang
The Bank of South Sudan (BOSS) has announced yet another increase of auction volume to 13 million US dollars to commercial banks and forex bureaus in an effort to further lower the exchange rate against local currency, SSP and revamp the battered economy.
The new governor of the BOSS, Moses Makur Deng vowed to bring down the inflation rate to as little as a single digit of 8% with a margin of plus/minus 1% from the current 13.2% rate by the end of this year.
In a press conference yesterday, Governor Deng told the media that the central bank would auction a total of 13 million US dollars weekly in order to tame volatility market prices and reduce the dollar exchange rate against South Sudanese Pound (SSP).
“As we speak, we have increased the amounts to be auctioned to forex bureaus from 2 million USD to 5 million USD and we have increased for banks from 3 million USD to 8 million USD,” Deng said.
“The total is 13 million US dollars a week, that’s what we are injecting in the market to fight this temporary increase in the dollar rate. We will continue to do that until the dollar stabilizes to where we want it to be,” he added.
Mr. Deng added that the central bank had also reduced borrowing or central bank rate from 15% to 12% and encouraged commercial banks to increase lending to private sector by 40% of their total deposits.
“We have reduced the course of borrowing by reducing what is called central bank rate from 15% to 12%. That deduction was necessary because we want to make borrowing cheaper if you reduce the rate of interest on borrowing you have increased the borrowing itself,” he noted.
A significant decline in the annual inflation rate has been witnessed in South Sudan since the beginning of last year, with the annual headline inflation rate for December 2021 being 13.2% compared to 58% in December 2020.
On 3rd January, President Salva Kiir appointed Mr. Makur the former Director-General for Supervision and Research at the bank as the new governor of the bank replacing his former boss Dier Tong Ngor.
President Kiir directed Mr Deng during his swearing ceremony to fix the exchange rates against the SSP and strive to revamp the worsening economy in the country.