This complicates direct talks that began recently between Saudi Arabia and the Huthis on a resolution to the wider conflict. Meanwhile, the first visible signs of progress in implementing a Saudi-brokered deal to end fighting between President Abd Rabbu Mansur Hadi’s internationally recognised government and the separatist Southern Transitional Council (STC) have emerged.
The situation remains fragile and both sides will make preparations to resume fighting should the talks collapse.
The Hadi government’s issuance of new bank notes may add to pressure on the Huthis, as it devalues their cash supplies.
Saudi Arabia may apply greater pressure to speed up the implementation of last year’s Riyadh Agreement.
Qassem Soleimani’s killing may impede progress, especially with reports of a failed US strike on an Iranian commander in Yemen the same day.
