Yemeni riyal in free fall in non-Houthi areas

Yemeni riyal in free fall in non-Houthi areas

By Sarah Hassan

The Yemeni riyal is continuing to lose value in what looks like a free fall in the areas outside the control of the terrorist Houthi militia, mainly the STC-militia controlled south Yemen and the government-controlled towns, financially affiliate to the central bank in the southern Aden.

The riyal stood today 1055 to the US dollar compared to 940 at the beginning of last month, 1005 two weeks ago and 1025 a week ago.

The Yemeni currency split and exchange rate diverged when ,in January 2020, the Houthis banned the smaller-size 1000 riyal banknotes printed by President Abd-Rabbu Mansour Hadi's government. The government did not reciprocate the move as, where it controls, both the big-size and small-size bills remained legal.

The exchange rate divergence widened so much with the riyal in Aden is now coming close to less than 50% of its worth in Sana'a and Houthis made so much money as fees of money transfers to their controlled areas soared to more than 50% of the transferred amount itself.

To bridge the exchange rate gap, the government printed last month big-size bills hoping they will be circulated in the entire country and re-unify the exchange rate.

The Houthi central bank banned them again and issued an order to the population under the militia's control to tell apart the "legal" from what it called the "fake" currency by the serial number on the notes.

Paradoxically, the militia's deep state in Sana'a are now buying these bills from money exchange shops in Aden and elsewhere through brokers sent specifically for this mission amidst warnings and calls on the central bank in Aden to clamp down on these Houthi subversive activities.

The government as a law enforcement authority has no presence in Aden as the city, its putative temporary capital, is under the control of the UAE's STC armed militia.

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