YEREVAN, April 10. / ARKA /. A former governor of Armenia’s Central Bank Bagrat Asatryan said today the risk of another dramatic drop in the cost of the national currency, the dram, still persists.
He recalled that the Central Bank’s reserves slashed by $750 million alone in 2014 and by another $200 million in the first two months of 2015 because the regulator had to sell that amount to try to stabilize the exchange rate of the dram. According to Asatryan, these moves jeopardize the exchange rate of the dram and may lead to another dramatic fall in the value of the national currency.
Asatryan praised the Central Bank for taking necessary measures late last year to stabilize the dram’s exchange rate, however, said in the present circumstances the regulator should abandon the policy of intervention to maintain the exchange rate of the dram.
Asatryan said the Central Bank should not have responded to the weakening of Russian ruble last December, although Russia is Armenia’s major economic partner, ‘because the impact of Russian economy on Armenia is inevitable and natural.”
“We must not oppose the formation of the real market value of our currency, and the Central Bank should abandon the policy of intervention to maintain the dram’s value, because abandoning that policy is likely to boost economic development,” said Asatryan.
Armenia’s international gross reserves surged by 18.1% in 2015 March to $1.491.5 billion, according to a provisional Central Bank of Armenia report. Foreign assets in convertible currency stood at $1.490.9 billion and the Special Drawing Rights (SDR) with the IMF were worth $0.7 million.
In 2014 Armenia’s gross international reserves slashed by 33.8% or $762.3 million to $1.489.3 billion. The reduction continued into 2015. In February they stood at $1.260.9 billion. –0–
