Dol­lar ex­change rate hits prices of ev­ery­day items

The Myanmar Times - Weekend - - Front Page - CHAN MYA HTWE chan­myahtwe@mm­

The high rate of the dol­lar to the Myan­mar kyat has hit or­di­nary peo­ple be­cause of the ris­ing prices for ba­sic com­modi­ties, and economists are call­ing on the gov­ern­ment to act quickly to ease their hard­hips.

THE down­ward spi­ral of the kyat against the US dol­lar has taken its toll on the prices that peo­ple have to pay for ev­ery­day items like rice, fish, meat, and veg­eta­bles.

Housewives com­plain that even the prices of salt, fish paste and other condi­ments that are sta­ples for or­di­nary folk have in­creased.

The prices of rice, eggs, onions and other veg­eta­bles are ris­ing, housewives said.

“One pyi (2.13 kilo­grams) of rice, which cost K2000 (US$1.25) be­fore, is now K2500. A bunch of wa­ter­cress now costs be­tween K400 and K500, up from K300,” one housewife said.

“The in­come of my hus­band and two sons, who pedal tr­ishaws, is un­sta­ble. Some­times we don’t have money, so we don’t eat,” she added.

She said the com­bined daily in­come of her hus­band and two sons is usu­ally be­tween K6000 and K7000.

“If I go to the mar­ket, that K6000 or K7000 evap­o­rates. It costs a lot to buy things now,” said the 56-year-old housewife.

As prices in­crease, in­comes are not ris­ing to keep pace. Daw Yee Yee Thant, 65, said the price of an egg has in­creased from K110 to be­tween K150 and 160, while the price of a viss (1.65kgs) of onion has dou­bled from K800 to K1600.

“It is go­ing to be very dif­fi­cult if the prices keep in­creas­ing. We are a fam­ily of 7, in­clud­ing my grand­chil­dren. Al­though my daugh­ter sells in the mar­ket in the evening, sales are not good as be­fore. Our in­come does not match our ex­penses,” she said.

Ma Zin Mar Oo, who sells food at the top of 40th street, said her former cus­tomers, of­fice work­ers and stu­dents, no longer buy as much from her as be­fore. She said some of them bring their own lunches to save money.

“Sales are not good,” she said. “It is dif­fi­cult to make ends meet, as prices have gone up. Be­fore this re­cent round of price in­creases, my earn­ings were not bad. If com­mod­ity prices go up more, the hard­ships of poor peo­ple like us will worsen,” she added.

The cur­rent in­fla­tion rate is 8.18 per­cent, one of the high­est in the re­gion, ac­cord­ing to gov­ern­ment data.

Gov­ern­ment and pri­vate economists say the dol­lar’s sharp spike is due to height­ened uncer­tainty caused by the trade war be­tween China and the US, which has led in­vestors to buy more dol­lar-de­nom­i­nated as­sets.

The Cen­tral Bank of Myan­mar has taken a slew of mea­sures to try to sta­bilise the kyat, such as by sell­ing mil­lions of dol­lars from its for­eign re­serves to lo­cal banks, float­ing the ex­change rate and launch­ing a new cur­rency swap fa­cil­ity. But the mea­sures have been in­ef­fec­tive, as the dol­lar con­tin­ues to rise.

“Based on the cur­rent sit­u­a­tion, we can­not ex­pect the ex­change rate to fall be­low K1500 in the fore­see­able fu­ture,” said econ­o­mist U Aung Ko Ko.

U Than Soe, a po­lit­i­cal and eco­nomic an­a­lyst, said the gov­ern­ment must take mea­sures to al­le­vi­ate the suf­fer­ing of the coun­try’s poor­est peo­ple caused by high prices.

He added that the min­istries should in­form the pub­lic about the rea­sons be­hind the in­fla­tion, the pos­si­ble length of time it will con­tinue, how they plan to solve it, and when prices may go down, U Than Soe, a po­lit­i­cal and eco­nomic an­a­lyst, said.

“When the bur­den on the grass­roots be­comes too heavy, crimes like theft, rob­bery and fight­ing oc­cur. Tr­ishaw drivers, for ex­am­ple, will try to un­der­cut each other so that they can have more pas­sen­gers. This may lead to more crime and chal­lenge the rule of law. We are wor­ried about it,” he said.

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