File: Central Bank Governor, Dier Tong addresses the press/Eye Radio.

The new governor of the Bank of South Sudan has increased the bank’s interest rates as the government tries to stop the rapid depreciation of the South Sudanese Pounds.

In an extraordinary meeting chaired by the newly appointed governor yesterday, Dier Tong said the bank’s Monetary Policy Committee resolved five resolutions aimed at tackling the devaluation.

Among the policies agreed upon is the increment of bank interest rate to 15 percent.

The bank’s reserve requirement rate for commercial banks and cash reserve ratio has been increased to 20 percent.

The bank also said it will introduce bills to manage liquidity.

The new policy is in sharp contrast to that put forward by the bank three months ago.

In July, the bank had reduced the interest rate from 13 percent to 10 percent.

Addressing members of the press this morning, Dier Tong expressed hopes that the bank will mitigate the current hyperinflation.

“The meeting was held on the backdrop of the rapid depreciation of the SSP and high inflation,” Dier Tong said.

“It suggested ways to calm the market, using available monetary tools.”

“The Monetary Policy Committee noted that the economy is severely battered by shocks brought about by the Covid-19 pandemic, low oil prices, which has led to considerable fiscal imbalances and constrained financial performance, particularly the banking sector,” the Centrl Bank governor added.

The South Sudanese Pounds has been depreciating drastically following the drop of the country’s oil revenues and irregularities in the collection of non-oil revenue.

As of Friday, 100 US dollar sold at about 57,000 South Sudanese Pounds in the black market, while at the Central Bank, 100 dollar sells at 17,100 pounds.

Consumers have complained of a sharp rise in the prices of basic commodities while traders have also raised concerns over their inability to access hard currency for importing goods.

Experts have repeatedly called for structural and institutional reforms to address the country’s economic woes.