Monrovia – As the economic situation in Liberia continues to escalate with the Liberian dollars trading at $98 and at some places 100 to US$1, the Central Bank of Liberia has disclosed that some individuals and businesses are hoarding large volumes of Liberian dollars, warning those involved to desist.
The Central Bank as at September 14 is quoting the buying rate at L$97 to US$1 and the buying rate of L$98 to US$1 but on the local market the exchange rate is slightly higher.
“The Central Bank of Liberia (CBL) has warned individuals and businesses involved in the hoarding of Liberian Dollars to desist or face punitive measures”, a statement issued by the bank noted.
The Central Bank has indicated that its warning comes in the wake of a disclosure by the Bank that some individuals and businesses are operating outside of the banking system.
The Bank said those involved are hoarding large volumes of currency, especially Liberian Dollars. Some of the hoarders, CBL said are using these cash hoards to adversely and artificially impact the exchange rate; actions, which according to the Bank, have the propensity to be interpreted as economic sabotage.
This unwholesome practice by such individuals and /or businesses, a CBL Press release said, undermines the integrity and soundness of the banking system and the economy as a whole.
The CBL statement furthered “The Central Bank warned those engaged in the hoarding currency to desist immediately. The public at large has also been urged to take note of the warning as the CBL will be taking appropriate actions to penalize violators”.
Liberia has seen slump in the economy with rising prices and devaluation in the value of the Liberian dollars to the United States dollars.
Since the start of the year, the Liberian has been depreciating in value gradually until September when the currency for the first time in centuries has fallen to the exchange rate of US$1 to L$100 or even higher in some places where businesses are in search of United States dollars to carry out international business transactions.
The Central Bank recently listed a number of factors contributing to the depreciating in the value of the Liberian dollars including the drawdown of the United Nations Mission in Liberia (UNMIL)