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Highlights
The YER in GoY areas plunged to a record low in March, reaching 1,660 against the US$, the fourth straight loss since November 2023. A currency crisis is slowly developing in SBA areas after the Central Bank in Sana'a issued a preemptive circular to all banks and money exchange outlets prohibiting the receipt of remittances in any other currency other than Saudi and Yemeni riyals, regardless of the source of original currency, typically USD.
Food and fuel imports slowed down in March in line with typical trends but have since rebounded in April 2024.
Fuel prices remained stable over the last one month in most markets but were significantly higher than the same period last year in GoY areas. Ample food availability in the markets stabilized the cost of the Minimum Food Basket (MFB) despite increased demand during Ramadan:
Livestock prices increased slightly during Ramadhan due to peak demand but remained lower than same period last year and the 3-year average in SBA areas. Casual labor wage rates on the other hand remained stable over the reporting month because of slow start of agricultural season and reduced off-farm economic activities during Ramadan.
Purchasing power for casual laborers decreased while those of livestock keepers increased over the reporting month Basic food prices are projected to continue increasing in GoY areas but remain generally stable or increase sightly in SBA areas in the next three months even though depreciation induced accelerated food inflation risks linger in the latter. The conflict in the Red Sea also carries the risk of increased food prices through June.