The exchange rate of US Dollar has once again dropped in the Maldivian black market.
Frequent exchangers report US Dollar is currently sold between MVR 17.30 and MVR 17.65, which is a reduction between MVR 0.20 and MVR 0.30.
At the start of the current fiscal year, US Dollar was exchanged between the rates of MVR 17.70 and MVR 18.00.
Local businesses and exchangers comment this decline is due to the steep increment in US dollar circulation in the Maldives market.
While the exchange rate has shown decline, for larger denomination and bulky exchanges, the current rates are between MVR 17.10 and MVR 17.20.
Interestingly, tourist arrivals to the Maldives has shown a near 14% increment in annual terms, with a resurgence in the Chinese and Russian markets at the top and second spots, respectively – both markets known for its tourists spending significantly in cash during their stays in the Maldives.
The exchange rate saw an all-time high during the Covid-19 pandemic, during which US Dollars were exchanged between MVR 20 and MVR 23, after which the exchange rate had stayed consistently above MVR 17.80, but still managed to stay below MVR 20.00.
Meanwhile, Maldives government is taking necessary steps to reduce reliance on US dollar for foreign transactions.
As such, earlier on April 28, it was reported that the island nation was negotiating with India and China to conduct trade using local currencies instead of US dollar.