A strong US dollar and the trade deficit resulted in the depreciation of the kyat by 12.7 per cent, Deputy Governor Daw Khin Saw Oo of the Central Bank of Myanmar was quoted as saying at Pyidaungsu Hluttaw Session yesterday.
She was submitting the report on implementation of fiscal policies and measures for financial stability of the CBM for the 2014-15 fiscal year at the session.
Demand for the US dollar was rising due to trade deficits during the fiscal year, she added.
However, the deputy governor said that economic growth was higher than that of previous 2014-15 fiscal year.
The economic growth rate rose from 8.4 per cent in 2013-14 to 8.7 per cent in 2014-15, according to statistics provided by the deputy governor.
Meanwhile, inflation slightly rose from 8.4 per cent in 2013-14 to 8.7 per cent during 2014-15, while the total amount of money in circulation also increased by 20 per cent at the end of the fiscal year, the deputy governor said.
However, she admitted that the CBM had to buy treasury bonds and certificates worth 30 per cent of the government’s budget deficit during the fiscal year.
At the end of the fiscal year, the central bank had permitted four state-owned banks, 22 private banks, 37 representative offices of foreign banks, nine financial companies, 241 money changers, 15 insurance companies and 226 microfinance firms.
Annual earnings of financial companies were also increasing during the fiscal year, according to the report.
Representatives were invited to debate the report during future sessions.
At the Pyidaungsu Hluttaw session, Union Minister for Electric Power and Energy U Pe Zin Tun sought approval of the session to sign an MoU on linking power networks of BIMSTEC countries, which he said was beneficial for Myanmar. Earlier, the session approved the amendment bills for the Ward/Village-tract Administration Law.
Source: Global New Light of Myanmar
