Sudanese pound falls against dollar

The Sudanese pound fell to its lowest since 2011, when South Sudan seceded, on the parallel market in recent days, currency traders said on Thursday, as the official banking system struggles to supply dollars needed to buy imports.

The cost of a dollar on the parallel market rose to 11.6 Sudanese pounds from 11 pounds per dollar at the start of the week, traders said. The government has kept the official rate at 6.4 pounds to the dollar since August.

“There is a dollar shortage in the market and demand is so high people will buy at any price because of how rare dollars are right now,” a parallel market trader said.

The Sudanese parliament is next week set to approve the 2016 budget, which projects a drop in inflation to 13 percent from 17.9 percent this year.

“We are expecting a rise in dollar prices with the new year because of higher demand from companies who work in imports because of the start of the financial year in January,” another trader said.

“There is no reason for the dollar price to fall because there isn’t enough supply right now.”

Prices soared in Sudan after South Sudan seceded in 2011, taking with it three-quarters of the country’s oil output, the main source of foreign currency used to support the Sudanese pound and to pay for food and other imports.

Fuel subsidy cuts introduced in 2013 also pushed up inflation, but their effects have since begun to ease.