The Central Bank of Myanmar announced that it would inject $100 million into the foreign exchange market to support fuel importers struggling with payments due to the ongoing devaluation of the kyat against the US dollar. Since the military takeover in 2021, the kyat has plunged, making it difficult for importers to secure fuel shipments.
Recently, long lines have formed at gas stations in Yangon, with some residents queuing overnight in hopes of filling their vehicles. The fuel shortage has also impacted businesses and hospitals reliant on generators during frequent power outages in the city of approximately 8 million people.
The Central Bank’s statement, however, did not specify when the injection would take place or the exchange rate to be applied. While the official military government exchange rate is 2,100 kyat per dollar, the black market rate hovers around 6,500 kyat.
Myanmar’s economy has deteriorated since the coup, sparking widespread protests and a military crackdown. Last December, the military government began cracking down on fuel hoarding, threatening imprisonment for anyone found storing more than 180 liters of fuel without a license.
Rising costs for cooking oil, rice, and other essentials have compounded the crisis as the kyat continues to depreciate. Last month, the Central Bank injected more than $16 million into the foreign exchange market to slow the currency’s devaluation, according to state media.
The Asian Development Bank predicted earlier this year that inflation would reach around 15.5% by the end of the fiscal year in March 2024.
