YEREVAN, August 26. /ARKA/. Artak Manukyan, an economist, thinks the Armenian dram will continue its downward motion against the US dollar, which is likely to be traded at 500 drams and more in late September.
“The Central Bank of Armenia has no sufficient resources to keep the dram’s value at the present level,” Manukyan said. “Besides, touristic season is coming to an end, and inflow of foreign currencies into the country will dwindle.”
He said that the dollar-dram exchange rate in Armenia is artificial – it is too far from real things, and the dollar reaches out toward its real height.
“Every country’s currency is the mirror of its balance of payments,” the economist said. “If we look through our balance of payments, especially export volumes and money transfers, we’ll see that the nominal dollar exchange rate in Armenia is too far from the real exchange rate.”
Manukyan said that the dollar went up all over the world because of the expected increase of the key rate by the U.S. Federal Reserve.
He also pointed out the slowdown in China’s economic growth as another adverse factor that impacts stock exchange indexes and world prices for copper. It is known that copper brings an intensive flow of foreign currencies into Armenia.
The Armenian dram was also stricken by devaluation of Russia’s ruble, since, as a rule, it reduce money transfers from Russia to Armenia.
“Russia is Armenia’s key trade partner, and the devaluation of the ruble against the dollar weakens our goods’ competitiveness in Russia’s economy, since the dollar in Russia is going up faster than in Armenia,” Manukyan said.
On August 24, the US dollar leapt 5.73 percentage points against the Armenian dram and traded at 483.43 drams, on average, at Armenia’s forex market, and the European currency soared 16.56 percentage points to 554.83 drams per one euro.
Experts say the dram devaluation is triggered by adverse developments at world forex markets.
It has become known on Thursday that Kazakhstan let its national currency float freely. Immediately after this step the tenge plummeted more than 30%. The move has been prompted by China’s decision on August 11 to devaluate the yuan to support its export and economy, as a whole, and by continuous devaluation of Russia’s ruble.
However, the dram devaluation was caused not only by direct impacts of outside factors, but also by skepticism over the Armenian dram that was grounded on deterioration of economic situation in the country – its foreign trade turnover shrank 20.6% over the first half of this year to $2 186 million and money transfers contracted by 30.5% to $537.1 million. —-0—–
