NBC riel buys to reach $43m

via Khmer NZ

Monday, 02 August 2010 15:00 Nguon Sovan

THE National Bank of Cambodia has announced a further US$13 million purchase of riels to bolster the faltering domestic currency, which reached record lows this year.

The latest buy would bring the National Bank of Cambodia’s (NBC) total riel purchases to $43 million for the year to date, still below the $54 million bought in similar measures last year.

Thirteen separate lots of $1 million will be placed for bidding at the NBC’s Phnom Penh headquarters from today to August 30, according to Friday’s announcement signed by NBC Director General Tal Nay Im.

Cambodia’s currency stood at 4,273 riels per dollar yesterday, a decline from 4,190 recorded in mid-April, figures from the Ly Hour Exchange in Phnom Penh showed.

The riel had depreciated by 2 percent in the first half of this year, compared to 2009, according to an NBC report.

“Besides seasonal factors in the country, the depreciation of the riel could result from the universal appreciation of US currency, compounded by the impact of the global financial crisis that influenced the inflow of funds into Cambodia,” the NBC’s six-month report said.

However, some analysts said they were not concerned by the decline in Cambodia’s currency, as the riel’s value usually falls at this time of the year.

“Though there has been a 2 percent depreciation this year; the riel’s value is still good and stable. I have not heard customers buying US dollars complain it is high in value,” Ly Hour Exchange owner Sieng Lim said yesterday. “It normally fluctuates depending on trade activities and dollar appreciation.”

Cheam Teang, ACLEDA Bank’s executive vice president and chief of treasury and international cooperation officer, predicted its value would bottom out by August.

NBC Director General Tal Nay Im could not be reached for comment yesterday, but said last month that the riel gained value in September or October every year.

According to NBC figures, it held foreign reserves worth $2.9 billion as of June.