In just two days, the Central Bank of Syria recorded the second consecutive depreciation of the Syrian pound against a basket of foreign currencies, in a move that reflects the acceleration of pressure on the local currency and the widening gap between official prices and market movement.
According to a bulletin issued on Thursday afternoon, June 25, the bank reduced the exchange rate to 11,850 pounds for buying and 11,950 pounds for selling, a decrease of 300 new pounds after less than 24 hours of a similar cut.
The central bank's bulletin published at 13:49 on Wednesday showed that the decline was not limited to the dollar, but included most major currencies — from the euro and the pound sterling to the Gulf riyal and the Kuwaiti dinar — suggesting a broad adjustment in the official pricing structure rather than just limited movement of one currency.
Experts believe that these accelerated adjustments represent an attempt by the Central Bank to keep pace with market pressures and reduce the gap with actual trading prices, at a time when markets are witnessing sharp volatility caused by high demand for foreign exchange and declining supply.
On the other hand, "Syrian News" monitored the increase in the exchange rate of the pound in the parallel market, as trading opened this morning at 13650 pounds before rising at noon to 13370 pounds, while many shops in Damascus refrained from selling until the price stabilizes.
An attempt to approximate the official and parallel price
This amendment comes within the framework of a monetary policy aimed at bringing the official price closer to parallel market levels, allowing remittances and commercial transactions to be attracted to banking channels and reducing the leakage of foreign currency to the black market. The latest reduction reflects the Bank's adopted a managed float policy, in response to the rising demand for dollars to finance import and production requirements as reconstruction activity expands.
The narrowing of the margin sends a message to speculators that price action is becoming more controlled, reducing pricing chaos and giving markets greater stability.
Economists believe that the depreciation of the pound by 3 new pounds (300 old pounds) could enhance the competitiveness of Syrian exports by reducing the cost of local goods for international buyers, which could be reflected in an additional flow of foreign currency and support for the balance of payments in the coming period.
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