Monday
25th Nov 2024
Dhivehi Edition
International Monetary Fund has urged the Maldives to stop printing money.
In a statement posted on its website today, the IMF called on the government to end the printing of money after concluding the consultation of the executive board to be held with the government in accordance with the IMF charter.
The IMF said that the government should stop overdrawing money from the central bank to contain inflation and keep the value of the currency from falling. The IMF also noted that the central bank should be prepared to tighten monetary policy to prevent the dollar from rising in the black market due to inflation.
The government has been printing money every year since 2020. When the central bank first pumped out such funds into the economy, the government said it would repaid it within a year. However, a year later, the government once again printed more money. The government had asked MMA to waive the amount after it said it would have to pay back the amount.
Due to excess Rufiyaa in the economy, the government had to use the foreign currency in MMA's reserves to defend the currency peg.
At the end of October, the reserves stood at $105 million. In November, the government borrowed $100 million from India amid fears that the country would run out of reserves.