Monday, September 25, 2017

MP calls for forex forecasts

A member of parliament has called for state media to publish forex projections to give certainty to businesspeople, as the kyat continues to fall against the US dollar.

The local currency has fallen by almost 25pc this year versus the greenback, from K1025 to K1283 according to the official reference rate, and looks likely to continue to fall.

Forex forecasts should be published alongside current exchange rates for the benefit of Myanmar entrepreneurs, particularly traders, said U Than Oo, Pyithu Hluttaw representative for Myawady township in Kayin State.

There is no market in Myanmar to hedge currency risk and importers have lost out this year due to currency weakness. In other countries, investment banks and other businesses publish forex forecasts, but in Myanmar this service is not widely available.

Businesspeople are therefore limited to watching the daily exchange rate, with little clarity on what the future will bring, said U Than Oo.

The official exchange rate is published each day in state-owned media and on the Central Bank of Myammar’s website.

State-owned media will not publish forecasts of the value of the Myanmar kyat, said U Ye Htut, Union minister for information to the Pyithu Hluttaw on August 20. “I propose that this should not be done at the moment, because it could lead to unnecessary pressure on the currency,” he said.

The kyat is weakening against the US dollar due to a combination of dollar strength and a growing domestic demand for imports, the Ministry of Finance told the Pyidaungsu Hluttaw

  Translation by Thiri Min Htun