Yemeni Rial Plummets as Government Funds Diverted to Groups

The Yemeni rial has plunged to unprecedented lows in government-controlled territories, with the US dollar nearing 2,350 rials—a grim milestone underscoring the currency’s freefall.

Anonymous banking sources told Khabar Agency that the US dollar’s exchange rate hit 2,346 rials on Thursday, while the Saudi riyal surged to 615 rials. The local currency’s value continues to erode daily amid hyperinflation and dwindling public trust.

In a statement issued Wednesday from its Aden headquarters, the Central Bank of Yemen (CBY) partially blamed the collapse on Houthi-led assaults on state revenue streams, particularly targeting oil infrastructure since October 2022. The attacks have crippled Yemen’s primary source of foreign currency, exacerbating the economic crisis.

The CBY also condemned rampant illicit revenue practices, urging the internationally recognized Presidential Leadership Council (PLC) to channel all state funds into official central bank accounts. “Diverting revenues to parallel entities undermines fiscal stability and national priorities,” the statement warned.

In a rare admission, the bank acknowledged that significant government income is being siphoned by armed factions and corrupt networks, exposing systemic graft that has hollowed out institutions. Meanwhile, over 17 million Yemenis face acute hunger as food prices skyrocket.

Economic analysts confirm that staple foods like wheat, rice, and sugar now sell at 300% above pre-war levels. With cash reserves depleted, families increasingly rely on piecemeal purchases, unable to afford bulk quantities. “The rial’s collapse isn’t just economic—it’s a death sentence for millions,” said a local trader in Aden.

The crisis highlights the intersection of war, corruption, and humanitarian catastrophe, with no respite in sight as competing powers prioritize control over recovery.