Malawi devalues its currency by 44 percent-Xinhua

Malawi devalues its currency by 44 percent

Source: Xinhua| 2023-11-10 01:03:30|Editor: huaxia

LILONGWE, Nov. 9 (Xinhua) -- The Reserve Bank of Malawi, the central bank, has announced the adjustment of the exchange rate for the Malawian kwacha from the selling rate of 1,180.29 kwachas to a selling rate of 1,700 kwachas to the United States dollar, representing a 44 percent devaluation of the kwacha.

The adjustment is effective from Thursday, according to a statement dated Wednesday, signed by Wilson Banda, governor of the Bank.

The statement said the devaluation of the kwacha follows an assessment conducted by the Bank that, among other factors, indicated that "supply-demand imbalances remain in the market despite adjustments of the exchange rate through the auction system."

Spot checks that the Bank conducted on some market players in the country indicate that "the market is able to clear import bills at this rate," read the statement.

In May 2022, the Malawian kwacha was also devalued up to 25 percent against the U.S. dollar, a development the central bank governor said would "allow the exchange rate to adjust to a market-determined clearing position with a view of endorsing a flexible exchange rate that reflects market fundamentals."

Meanwhile, the Ministry of Finance and Economic Affairs has said the minister, Simplex Chithyola, will soon address the public on "measures the government has put in place to cushion vulnerable Malawians and stimulate economic growth following the Wednesday devaluation."