Lockdowns due to Covid-19 have created many obstacles for the economies of the countries worldwide. In an effort to bring relief after the impact of the economic crisis, the central bank of South Sudan has decided to reduce the interest rate from 13% to 10%.
Apart from that, the bank also lowered the ratio of cash reserve from 15% to 10%. This ratio signifies the minimum amount of deposits from customers that must be held by the banks. This move should help reduce the struggles of both companies and individuals during the pandemic.
According to Gamal Abdalla Wani, the governor of the Bank of South Sudan, these measures can give commercial banks access to more cash. In addition, this should also lower financing costs for the private economic sectors.
In March this year, the central bank has attempted another measure due to the Covid-19 pandemic. As such, it involved the purchasing of crude gold. New measures are receiving support from the government of South Sudan. The banks will receive $5.5 million as support funds, which should in the long run help stabilize inflation rates in the country.