The Maldives Monetary Authority (MMA) significantly increased its dollar sales in July compared to the preceding month. This surge was primarily driven by a decline in foreign currency inflows due to the tourism off-season, alongside a 172% spike in demand for travel and medical expenses during the school holidays. Consequently, the Maldives’ official reserves saw a 7% decline, reaching USD 638 million by the end of July.
To alleviate the foreign currency shortage in the market, the MMA has decided to increase dollar allocations to banks by 51% for a three-week period starting August 11. This measure is intended to facilitate businesses in processing Telegraphic Transfers (TTs) and Letters of Credit (LCs) for essential imports. Furthermore, to address challenges in foreign exchange regulations, a proposal has been submitted to Parliament to revise the mandatory dollar exchange requirements for resorts based on tourist arrivals.
