$200m currency intervention to fight inflation

Myanmar’s central bank has decided to inject over $200 million worth of foreign currency into the forex market to control inflation that it says is caused by soaring fuel prices.

The central bank has frequently sold dollars to defend its currency, but this marks the first intervention of over $100 million since the military took control of the government last year. Such operations are capped at around $50 million.

The announcement Wednesday came after the kyat depreciated by nearly 40% since the beginning of August. That day, the kyat traded at around 4,000 per dollar. On Thursday, following the release of the notice, the currency rallied to roughly 3,500 kyat per dollar.

The Central Bank of Myanmar has yet to disclose how it will supply dollars into the market.