US dollar jumps to $233

There is a shortage of US dollars in the streets and it has sent the selling price to over $230. Saturday, the different cambios were selling for as high as $233 for one US dollar. It would be highest in years with knowledgeable persons predicting that the situation will only get worse. At the banks, the exchange rate for wire transfers was $218. In fact, the commercial banks had significant funds to conduct and make payments for businesses. It was on the road that the problems existed. Bank of Guyana’s Governor, Dr Gobind Ganga, had been contacted over a week ago when complaints were made to Kaieteur News that there is a shortage of US cash.

According to the Governor, the Central Bank as the regulator was monitoring the situation. He insisted that there is no shortage of funds for wire transfers. However, while Ganga was reassuring that, the demand for US cash has been pushing the exchange rates up.

Kaieteur News was told that cross-border trade with Venezuela and the presence of regional companies including from Trinidad and Tobago have contributed to the problem. In recent times, despite coldness between Venezuela and Guyana, there has been trade in rice and other commodities. Venezuela, in the throes of runway inflation, internal conflicts and little foreign currency, has been depending on Guyana.

With regards to especially companies from Trinidad, they have been holding on to the cash they trade in. These have been making it back to that Twin-Island Republic. Then there are the issues of the telephone companies. They have been making large, steady purchases of US cash from cambios and the streets.

The Chinese, reportedly, have also been making significant purchases. “All of these have been compounding the situation. When you also take into the account that we have been receiving significant cash infusion into the economy by investors from especially the oil and gas sector, while we have not been matching up in terms of trade exports, you begin to have an idea. We are predicting the demand for US dollars will rise more,” a banking official said.

In the past, the Bank of Guyana had stepped in, making raids to cambios and foreign companies based here to verify their transactions. The entire region is facing a major foreign exchange problem with Guyana seen as a saviour. Counties like Trinidad and Tobago, Barbados, Suriname and Venezuela are among those facing those problems. Guyana had to restrict trade in Bajan and Trinidad currencies after it was found that the respective countries were dumping large sums here in exchange for US dollars.

(Kaieteur News)