The black market exchange rate for the US Dollar has surged to an unprecedented MVR 22.10, marking the highest rate ever recorded in the country's history.
After holding at MVR 21.70 on July 29, the black market rate has seen a steady climb over recent days. By the end of last week, the rate stood at MVR 21.85, which was already a record high at the time.
To combat the ongoing dollar shortage gripping the economy, President Mohamed Muizzu introduced a new policy mandating resorts and guesthouses to exchange their foreign currency earnings through local banks. Following the announcement, the government assured the public that the dollar rate would not rise further. However, the current market reality appears to be defying the administration’s expectations.
Data shows that even during the peak of the COVID-19 pandemic—when borders were closed and the tourism industry came to a complete standstill—the black market rate peaked only briefly at MVR 19.50. Furthermore, when Muizzu assumed office, the dollar was trading at MVR 17.45 on the parallel market.
The Maldives Monetary Authority (MMA) maintains an official exchange rate of MVR 15.42. The current black market rate represents a premium of MVR 6.68 over the official peg, a 43.32 percent increase.
Economic experts attribute this sharp appreciation to the difficulty importers face in securing foreign currency through the formal banking system. Additionally, the state’s foreign debt obligations have intensified the demand for dollars, further driving up prices on the black market.
As the dollar rate spirals out of control, the cost of goods and services in the Maldives is rising rapidly. This inflationary pressure is increasing the cost of living for citizens and presenting severe economic challenges.
Real-time updates on exchange rate fluctuations can be monitored via the Adhadhu Dollar Tracker.
