Sudan Dollar Hits SDG 7,400 as Fuel Supply Improves

The US dollar traded at SDG 7,400 on the parallel market on Monday. This represents a sharp drop from the SDG 8,400 level recorded earlier in the week. Traders cited reduced demand for foreign currency as the primary driver of this decline. The official buying rate at Faisal Islamic Bank stood at SDG 4,334 during the same period.

Commodity prices showed early signs of adjustment to the weaker dollar. A malwa of wheat in El Gezira fell to SDG 16,000. Animal feed prices dropped from SDG 170,000 to SDG 140,000. These reductions follow directly from the shift in exchange rates and improved supply conditions.

Supply Increases Drive Rate Down

Economic analyst Ahmed bin Omar linked the drop to higher foreign currency supply. Demand eased after the sharp surge seen in the previous week. Several fuel-carrying vessels completed their movements, improving overall supply levels. This reduced the immediate pressure to finance fuel imports with hard currency.

Khartoum Bank announced a USD 1 billion revolving finance facility for strategic imports. This move provided importers with access to foreign currency through formal banking channels. Consequently, the volume of demand directed at the parallel market decreased. Traders also adjusted their expectations, selling dollars as the prospect of continued gains faded.

Market Stability Remains Elusive

Importers face uncertainty because existing inventory was purchased at higher exchange rates. Commodity prices adjust slowly due to embedded transport and financing costs. The full impact of the lower dollar will appear only when new shipments arrive. Traders await a period of stability before prices respond more clearly.

Sustained stability depends on consistent foreign currency inflows through official channels. Any reduction in bank financing could push demand back to the parallel market. This would likely resume pressure on the exchange rate and drive the dollar higher again. The current decline lacks a fundamental structural guarantee.

War Devastates Economic Output

Finance Minister Jibril Ibrahim stated that the war severely impacted the private sector. Gross domestic product fell by more than 40 percent during 2023 and 2024. The state lost over 80 percent of its tax revenues. These figures highlight the depth of the economic contraction reported by dabangasudan.org.