Happy Monday!
This week we cover the critique of the Central Bank’s Open Market Operations, issues regarding cooking gas prices, and Suriname’s new role as the chair for the Caribbean Development and Cooperation Committee.

The Central Bank was under fire by the Surinamese community and parliament for the mismanagement of Open Market Operations.

• Despite measures to curb the depreciation of the SRD and talks with the financial sector, the exchange rate continues to drop daily.
• The Central Bank of Suriname’s quoted rate for the US dollar is 37.79, but the rate is even higher at cambios and banks.
• The Finance and State Household committees see opportunities to achieve stability in the exchange rate development, but all parties must provide support and perform their tasks properly.
• Discussions have been held with various organizations, including the Minister of Finance & Planning and the governor of the CBvS, but it has become clear that the CBvS is not performing its role properly.
• Correct information will be sent to the National Assembly no later than next week, and the public meeting will be continued after consultation with the government and discussion of comments from various organizations.

The central bank has argued against the accusations with support from the banking association and cambio association

• The Central Bank of Suriname issued a statement defending its Open Market Operations (OMOs) in response to criticism.
• OMOs are a standard monetary instrument used by central banks worldwide and play a role in sterilizing excess liquidity in the macro-fiscal framework.0
• Money creation in 2022 was due to net government expenditure and the withdrawal of State assets from the financial institution, leading to a decrease in the effectiveness of OMOs.
• Market-based interest rate transmission at banks has not started yet, but the issue of Central Bank Certificates has caused some movement in deposit rates.
• The bank believes that OMOs are to tighten the money supply and have helped prevent higher exchange rates and inflation levels
• Billions of Surinamese dollars are always tied up with banks, and this liquidity could have created demand in the foreign exchange market.
• The abolition of government subsidies and import inflation are putting pressure on price levels in Suriname.