Central Bank Pursues Robust Measures to Stabilize the KIP
Source: Vientiane Times
The Bank of the Lao PDR will continue to implement stringent controls to stabilize the value of the kip and ease the burden caused by the spiraling cost of living.
A senior official announced the bank’s intention to take strong action to rein in the depreciation of the kip at a press conference held on April 13.
Head of the bank’s Monetary Policy Department, Mr. Soulisack Thammavong, said the inflation rate in March was still high but had dropped slightly from 41.26 percent in February to 40.97 percent. Meanwhile, the price of goods fell by 1.64 percent in March compared to February.
“Currency exchange rates this year have been fairly stable and we have recorded a steady balance of trade since 2020,” he added.
To ensure continuing stability in the value of the kip and keep the cost of living at an acceptable level, the Bank of the Lao PDR will carry out more concrete measures in relation to currency exchange rates.
These will be regularly reviewed and the measures implemented by the central bank in the first quarter of this year will be continued. Bank officials will also ensure that exchange rates are based on market forces.
The central bank will continue to foster an environment that strengthens the flow of foreign currency into the economy while also monitoring and controlling illegal currency exchange and curbing the rising cost of living, which is creating hardship for the general public, especially people on low incomes.
Mr. Soulisack said that in the first quarter of this year, the economy had suffered from challenges due to external factors, including an increase in the interest rate by the US central bank (Federal Reserve System) aimed at controlling inflation.
This strengthened the US dollar compared to other currencies, while the fluctuating price of fuel continued to affect the value of the kip and drive up the cost of living in Laos.