Logo of Phnom Penh Post newspaper Phnom Penh Post - Riel holds amid dollar dip

Riel holds amid dollar dip

A woman sorts through stacks of Cambodian currency in Phnom Penh. Despite the surprising US election result last week, the riel held strong against the dollar in trading.
A woman sorts through stacks of Cambodian currency in Phnom Penh. Despite the surprising US election result last week, the riel held strong against the dollar in trading. Heng Chivoan

Riel holds amid dollar dip

It may be too early to say whether Prime Minister Hun Sen’s prediction that Donald Trump in the White House will be a boon for world peace was accurate, but as foreign exchange markets closed on Friday evening, it appeared to have done the Cambodian riel a favour.

On November 7, the eve of the US elections, one dollar bought 4,082 riel; by Friday evening, it had dropped in value against the riel by 2.2 percent, buying just 3,992.

In Channy, CEO of Acleda bank, said that he believed the tumble was related to America’s surprise election result.

“I think it is related to the election in the US, but the Cambodian riel is stable,” Channy said.

Of the two currencies, Channy believes Cambodia’s is the safer investment, something he said is reflected in the behaviour of the Kingdom’s financial institutions.

“Some financial institutions offer 7.75 to 9 percent interest [rates] on the riel, it means they trust the stability of the riel so they can offer higher interest rates,” Channy said, noting that most institutions offer an interest rate of just 6.5 percent for dollar investments.

Economist Mei Kalyan said that while he lacked sufficient data to offer a solid conclusion, the riel’s gains could be down to internal as well as external factors.

“There are two tendencies, one is US dollar [going down] because Mr Trump was elected and [the second] is the harvest season in Cambodia,” Channy said. “They need riel to buy agriculture products because the rural areas work in riel, not in dollars.”

MOST VIEWED

  • Cambodia unveils new quarantine regulations

    The government has modified Covid-19 quarantine requirements, shortening the duration for, among others, Cambodian officials, foreign diplomats and delegations, investors and inbound travellers in general. According to an official notice signed by Minister of Health Mam Bun Heng late on October 16, quarantine length for Cambodian

  • Cambodia sets new Covid-19 quarantine rules

    The government has modified Covid-19 quarantine requirements, shortening the duration for, among others, Cambodian officials, foreign diplomats and delegations, investors and inbound travellers in general. According to an official notice signed by Minister of Health Mam Bun Heng late on October 16, quarantine length for Cambodian

  • Hun Sen: Cambodia set to fully reopen

    Prime Minister Hun Sen concludes that the October 5-7 Pchum Ben public holiday, during which many people either flocked to their hometowns for family reunion or gathered at tourist attractions across the country, has not caused an outbreak of Covid-19. In a special address to

  • Will Evergrande change the way Chinese developers do business in Cambodia?

    China’s property sector policy has exposed the grim financial condition of real estate developers including those operating in Cambodia, which raises questions over the viability of their projects and business going forward The dark blue netting draping over one of Yuetai Group Co Ltd’

  • Cambodia resumes issuance of tourist visas

    The Ministry of Foreign Affairs and International Cooperation has announced the resumption of its tourist visa and visa exemption programme after a long hiatus due to the Covid-19 pandemic. In a letter dated October 20 and addressed to foreign embassies and consulates, foreign minister Prak Sokhonn

  • S’ville set to turn into ‘second Shenzhen’

    The Ministry of Economy and Finance has awarded a master plan consultancy contract to top Chinese institute for the development and transformation of Preah Sihanouk province into a “Model Multi-Purpose Special Economic Zone”, Southeast Asia’s next logistics and resort hub and innovation centre. The