New Delhi (Mizzima) – The difference between the buying price and selling price of the US dollar in Burma is rapidly changing as a result of too much selling in dollars, according to money dealers.
This week, the value of the US dollar has taken a gradual leap, and as a result, the difference between the buying price and selling price has reached 15 kyat. Normally, the difference is at most five kyat.
‘Today, the value of the US dollar decreased against the kyat. The selling price of one US dollar is 875 kyat and the buying price is 890 kyat. If you want to sell a large amount, you can get at most 880 kyat per one dollar’, said a dealer.
‘In normal times, the difference between the buying price and selling price of US dollar is just about three kyat’, a dealer in Kyauktada Township told Mizzima.
In early February, the exchange rate was 850 kyat per one dollar and the price of US dollar has increased gradually since then. It reached 950 kyat. Then the dollar price fell to the price of 875 kyat on Friday.
Rumours about the junta’s plan to issue a new 10,000 kyat bill, a potential wage increase for civil and military servants, and news about the political instabilities of assemblies caused traders to increase the value of the dollar, said economist Khin Maung Nyo.
‘The traders are carefully watching the Parliament’, he said. ‘Former Lieutenant General Tin Aye resigned as an MP on Wednesday. And many rumours are spreading. So, traders think that there is likely to be political instabilities. That caused problems’.
Along with the dollar price, gold prices in Burma have increased. Last week, the gold price was about 640,000 kyat per tical (about 16 grams). It reached 680,000 kyat per tical on Wednesday.
Currently, buyers are reluctant to buy gold because of the high price, so the price fell again to about 660,000 kyat.
‘The dollar price increased and then so did the gold price. Then, the prices reached fresh price highs and then fell again. Buyers don’t want to buy with very high prices. So, the trade becomes idle’, said a gold shop owner in Lanmadaw Township in Rangoon.
Similarly, the price of diesel fuel has also increased from 3,300 kyat to 3,500 kyat, because it depends on the dollar price.
Economist Khin Maung Nyo said, ‘The countries that have poor production will suffer a lot, if the dollar price increases. The dollar price and gold price depend on the political situation. Monetary stability is very important in the economy. If a country cannot manage to create monetary stability, its economy will be ailing’.
Although the price of one US dollar in the real market is about 900 kyat, the official exchange rate is just six kyat to one US dollar.
