YEREVAN, December 29. / ARKA /. Armenian Prime Minister Hovik Abrahamyan said today he did not expect serious turmoil in the financial market.
“We do not expect serious fluctuations of the exchange rate of the currencies. The Central Bank which is responsible for monetary policy, will carry out all the necessary work, and the government will help it in it,” Abrahamyan said on Monday during a New Year’s reception for the media.
The Armenian dram began losing its value on November 24. On December 17 its official exchange rate fell to record low over the last 10 years to 527.20 drams per one USD. But after the Central Bank and the government took action to stabilize the tension the national currency strengthened against USD to 456.17 drams.
More precisely, Central Bank on December 23 lowered the reserve requirement for local commercial banks in foreign currency from 24% to 20%, leaving the reserve requirement in the national currency, the dram, unchanged at 2%.
Also the regulator raised its key refinancing rate by 1.75 points to 8.5 percent in a bid to mitigate future inflationary pressures and encourage the return of inflation to the target band.
The Central Bank increased also the rate on borrowed funds from 5.25% to 7%. Earlier it had also reduced the Lombard REPO rate by 1 percentage point to 20%. -0-
