By William Madouk
The Central Bank of South Sudan (BoSS) will inject 5 million US dollars into the local market in a bid to mop up access liquidity to stabilize plummeting South Sudanese pounds.
BoSS Foreign Exchange Auction Supervisory Committee, acting Chairperson, Grace Araba Gordon said 3 million will be allocated to commercial banks and 2 million to forex bureaus in an upcoming auction that will take place on February 16, 2023.
“The bank of South Sudan intends to sell US dollars 2,000,000 (two million only) to eligible forex bureaus,” Araba said.
In a separate statement, Araba also said “The bank of South Sudan intends to sell US dollars 3,000,000 (three million only) to eligible commercial banks.”
Central Bank said the auction process and procedure will be governed by BoSS foreign exchange laws.
“Auction process will be governed by the Bank of South Sudan’s Foreign Exchange Auction rules and procedures,” added the statement by BoSS.
The maximum bid amount for each commercial bank will be 10% of the $3 million set to be auctioned while for forex bureaus, it will be 5% of the $2 million dollars to be auctioned the same day.
This was after the local currency – SSP hit a record low against the US dollar last week, as one dollar sold at SSP 800 the highest depreciation ever, leading to a hike in essential commodities prices in markets.
However, the Central Bank of South Sudan on Friday last broke their silence on the SSP VS dollar dilemma citing that they are aware of the strong appreciation of the US dollar against major currencies globally.
BoSS then urged forex bureaus and commercial banks to display their exchange rates and consoled the citizen that the bank has set aside plenty of dollars that can tame the wild market.
“The bank has accumulated sufficient foreign exchange reserves boosting its capacity to intervene in the foreign exchange market occasionally to smoothen high volatility,” said Johnny Ohisa, the governor of the Central Bank.
BoSS further called on licensed forex bureaus and commercial banks to display their exchange rates, so that the public can deal with authorized dealers rather than risk with unreliable street or black market dealers.
The Governor of BoSS lamented that what led to the high demand for hard currency was due to private and public entities paying domestic staff in US dollars, and based on that BoSS declared the use of local Pounds as the only legal tender of transactions in the country.