CB chairman: Manat won’t decline by year-end

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# 09:06
30 May 2017

According to him, as a result of measures planned by the Financial Stability Council, Central Bank of Azerbaijan announced switch to floating exchange rate regime in early 2017: “I can surely say that Central Bank does not make any interference in exchange rate of manat today. However, I’d like to speak about several specific steps. Certain destabilization was observed while switching to the floating regime. Even, the exchange rate of manat made up 1.92 sometimes. This process was observed in other neighbour countries. However, macroeconomic frame allowed us to prevent sharp hesitation of the manat rate. Balance between demand and supply in the market regulated it. Then the manat rate increased 11% compared to the highest level (1.92). The exchange rate of manat has gone up 4% since early 2017. Currently, the currency market operates normally and there is not any deficit in the market. Economic activity participants and actors fully meet their demand for currency. Today, the currency market is a market of demand. Business, banks, market participants feel that strengthening of manat rate has its own pressures. Taking into account the mid- and long-term interests of the country, we can say that more strengthening of manat will not be good. Because this process may cause problems for balance of payment. Generally, real exchange rate of manat against the basket consisting of currencies of main trade partners weakened more than 50%. This is a great advantage for our exporters”.  

 

He also noted that mnaat rate is not expected to fall by the year-end.

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