YEREVAN, July 7. /ARKA/. Armenian Central Bank’s intervention in the local foreign exchange market since the beginning of the year has been minimal, the chairman of the Central Bank Arthur Javadyan said on Friday during an extraordinary parliament session.
According to him, the Central Bank continues the policy of the floating exchange rate, and the intervention was very insignificant, almost as much as in 2004, while in previous years it was more often.
“In the first five months of 2017, we did not intervene at all in the local forex market and in the last two months we have been only buying currency, so as not to allow the exchange rate of the dram to increase,” Javadyan said. He said that the Central Bank does not want to exert any pressure, except for intervention in case of shock situations.
“We will intervene only if there is a strong fluctuation in the exchange rate. For example, at the moment the proposal has increased, so we are buying currency,” Javadyan said.
According to the Central Bank, from the beginning of the year until May, the Central Bank made interventions only in January, selling $15 million at the exchange rate of 485.84 drams per dollar.
Javadyan said also that the level of dollarization in Armenia is decreasing. According to him, after the devaluation of 1999, the level of dollarization has increased significantly – from 40% to 75%, and the volume of deposits in dollars has increased too.
He noted that in recent years, after the shock of 2014, this figure has changed. In 2016, the level of dollar deposits in relation to the dram deposits was 72% to 28%, and in 2017 – 66% to 34%.
“At the moment, this ratio has already fallen to 65% to 35%, indicating the growth of dram deposits and demonstrates the public’s confidence in the Armenian national currency as well as the increased ability of banks to provide loans in drams,” Javadyan said. –0-
