Yemen

Cash Consortium of Yemen - Flash Update 7: YER Exchange Rate Volatility 20 September 2020 (Week 1 and 2)

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Introduction

The Flash Update for Exchange Rate Volatility consolidates daily exchange rate data collection throughout Yemen by CCY partners. The data is split between the two main economic spheres: Defacto Authority (DFA) and the Internationally Recognized Government (IRG). This flash update is meant to give insight into the exchange rate and allow the actors within the Yemen response to make more informed decisions.
Methodology: The analysis is predicated on assessing the averages of exchange rates between the spheres of influence for both actors. Enumerators were told to assess three exchange shops per district, however, due to travel constraints and the size of towns where enumerators are present, assessing three shops daily, may not be possible.

Key findings:

• Sana’a airport has been closed

• The economy is still strained under the worldwide impact of COVID 19, mainly in trade and travel

• Remittance flows from Yemenis abroad into Yemen have continued to stagnate

• Clashes between STC and IRG continue to take place sporadically

• IRG vs DFA exchange rate difference (30% difference)

• Due to a lower supply of USD, exchange shops have irregular hours of operation

• Though some exchange shops have closed down, street brokers are continuing to buy USD though informal purchases (sometimes made on behalf of traders)

• During the writing of this output the Yemen Central Bank issued new instructions to exchange institiutions

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