Sudan Let Banks Set Dollar Rates and the Pound Hit a Record Low

SUDAN · MARKETS

The Sudanese pound fell to a record 6,400 per US dollar on the parallel market on Thursday, three days after the central bank let commercial lenders set their own exchange rates. The measure was meant to close the gap between official and street prices, and so far it has widened the fall.

Port Sudan’s harbour. The wartime government and the Central Bank of Sudan now operate from the Red Sea city. (Photo: Bertramz, CC BY 3.0, via Wikimedia Commons)

What the Sudanese pound actually did this week

The currency touched 6,400 to the dollar on the parallel market on Thursday 27 August, according to Sudan Tribune, which cited traders and market participants. Dealers told Reuters the dollar traded between 6,350 and 6,400 at the close of the session.

That is the unofficial rate rather than the bank rate, and the distinction matters. Sudan has run two prices for foreign currency for years, and the parallel one is where most households and small importers actually transact.

All pound figures in this article are parallel-market rates in Sudanese pounds per unit of foreign currency, as reported on Thursday. The immediate cause is not disputed by anyone involved: the central bank loosened the rules, and the currency reset lower.

The circular that changed the rules

The Central Bank of Sudan issued Policy Management Circular No. 16/2026 on Monday 24 August, repealing restrictions on the rates commercial banks may declare. It cancels a 14 January circular on exchange rates and an 11 August circular on reserves and gold management.

Banks may now adjust their announced rates during the day, provided the new price is posted on their boards first, and may buy export proceeds at those announced rates. If a bank cannot absorb the proceeds on offer, it can refer the seller to the central bank as buyer of last resort, after coordination.

The regulator framed this as a step towards a managed float — a system where supply and demand move the currency but the central bank keeps the option to step in. The aim is to pull business back into the formal banking channel.

The logic is orthodox enough. If banks may pay something close to the street price for export dollars, exporters have less reason to sell outside the system.

The dirham is the currency that actually matters

The UAE dirham climbed to 1,710 pounds (about US$0.27) on Thursday from about 1,695 earlier in the week. For Sudan it is not a secondary currency but a working one, used for trade payments and for money sent home by the diaspora.

That reflects where Sudanese commerce now runs. Gulf intermediation has taken over much of the import and remittance business that once cleared through correspondent banks further afield.

It also means the dirham rate is the better daily read on household purchasing power. Watching only the dollar understates how much has changed.

One bank posted a rate nobody can explain

Bank of Khartoum cut its posted dirham rate to 972 pounds (about US$0.15) on Thursday, having listed it at 1,630 the day before. That is a fall of roughly 40 percent in a declared rate in a single day.

It also sits far below the roughly 1,710 pounds (about US$0.27) the dirham was fetching on the parallel market at the same moment. No explanation has been offered by the bank or by the central bank, and none should be invented.

The most that can be said is that lenders are applying the new latitude very differently from one another. A managed float depends on banks converging, and this is the opposite.

What an outside reader should take from it

Analysts quoted by Sudan Tribune think the pound could steady in the short term if banks succeed in absorbing export receipts and supplying commercial buyers. None of them are named, and none put a number on it.

The harder constraint is the war. Sudan has been fighting since April 2023, the government and the central bank operate from Port Sudan on the Red Sea, and no exchange rate mechanism repairs reserves, infrastructure or a lost harvest.

For anyone with exposure to Sudanese trade, the practical question is not the headline rate. It is whether a bank will actually execute at a posted price two days running.

This is currency reporting rather than financial advice, and rates in a war economy move quickly. The figures here are those reported on Thursday 27 August and will already have shifted.

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