SYP: Still Wary Of Depreciation Risks

While Syrian authorities have touted the success of intervention measures aimed at stabilising the value of the Syrian pound, we are not wholly convinced by the evidence, and therefore we highlight the possibility that the currency could face another sudden depreciation in the near term (see our online service, May 18, 'Savings Rate Increase Will Weigh On Growth'). Indeed, the Central Bank of Syria (CBS) increased interest rates and liberalised rules on exchange rate transactions in May in order to raise confidence in the pound and keep deposits in Syria's banks. Officials from the CBS and Ministry of Finance later stated that the measures had helped reduce depreciatory pressures on the unit and keep deposits in the banking sector, according to local media sources.

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