Jeddah- Speculations witnessed in the black market have led to the sudden drop in the Yemeni riyal exchange rate against a number of other currencies, mainly the US dollar and Saudi riyal while Yemeni currency has managed to preserve its exchange rate against other Gulf currencies.
The exchange rate of the Yemeni riyal has seen a decline against other foreign currencies at the beginning of the month’s trading, which was described by traders in the exchange market as a surprise.
The sudden decrease in the value of the Yemeni riyal led to a new wave of inflation that caused a rise in the food prices, coinciding with the availability of liquidity from the local currency after salaries were paid by the legitimate government following a long stalemate.
According to economic analysis for the reasons behind the sudden drop in the Yemeni exchange rate, the intentional speculations are behind the decline that began on July 1, the first day of the weekend for currency markets worldwide.
In this matter, strategic expert Qassem al-Mahbashi told Asharq Al-Awsat that the intentional speculations have returned to the black market and led to the drop of the Yemeni riyal against the US dollar and the Saudi Riyal while prices remained unchanged against the Omani riyal, the UAE dirham, and the Bahraini dinar.
He added that the drop in the exchange rate of the riyal coincided with the high volume of liquidity traded from the local currency after the success of the legitimate government in the expenditure of salaries in many Yemeni provinces and governorates, including areas under the control of the Houthi rebels.