The dollar deficit has gotten so bad that some money changers have shut down their businesses. Money changers said in a post on Facebook that branches of the Northern Bridge Exchange Service have temporarily suspended their operations due to currency uncertainty at the moment. However, those who are still surviving in business are paying 2,600 kyat for every dollar. They had to pay 1,895 kyat on September 1, which was 1,395 kyat when the military overthrew the ruling Aung San Suu Kyi government in February.
According to a World Bank report released on Monday, Myanmar’s economy will shrink by 18 percent this year. Partly due to the epidemic, there will be the biggest contraction of employment in the region and the number of poor people will increase. This growing economic pressure is being seen as a sign of further crisis for Myanmar. Since taking power, the military rulers across the country have had to deal with mass discontent and protests. People are becoming more and more courageous. If this fragile state of the economy continues, armed struggle may begin in the country. Because the armed militia has already become quite brave in the conflict with the army.
A senior executive at a bank in Myanmar said the worse the political situation, the worse the exchange rate.
In the months leading up to the February 1 coup, many lined up to withdraw savings from banks. Some would buy gold. But a jewelry dealer in Yangon said many frustrated people are now trying to sell their gold.
Analysts expect the country’s foreign exchange reserves to fall sharply. The United Nations Office for the Coordination of Humanitarian Affairs (OCHA) said this week that about 30 million people in Myanmar now needed humanitarian assistance, up from 1 million before the coup.
The price of a 48 kg sack of rice was 47,000 kyat before the coup. At present, the price of that amount of rice has increased by 40 percent and the price of fuel has doubled to 1,445 kyat.