AZƏRBAYCANDA KORONAVIRUSLA BAĞLI XƏBƏRLƏR

No need to convert manat to US dollars in Azerbaijan

No need to convert manat to US dollars in Azerbaijan

Economy
13 March 2020, 17:32 266
Currently, the main task is to regulate demand and prevent panic in the Azerbaijani foreign exchange market, Vusal Gasimli, executive director of the Azerbaijani Center for Analysis of Economic Reforms and Communication, said, Trend reports referring to the center.
"About 81 percent of the expanded money supply (m3) was in manat in 2014, and now this figure is 63 percent,” Gasimli added.
"In other words, the share of manat in the money supply from 2014 through 2020 decreased by almost 30 percent,” executive director said. "This means that now there is less need for converting manat to the US dollars than in 2014.”
"While comparing the current indicators of the share of cash outside the banks in the expanded money supply with the same indicator as of 2014, we are currently observing a big decrease of 45 percent,” Gasimli said. "In settlements with monetary aggregates, the dollarization pressure greatly decreased compared to 2014, so it is now easier for the government and the Azerbaijani Central Bank (CBA) to meet the demand in the foreign exchange market.”
"Given the prospects of a decline in import from China, Iran and other countries this year and taking into account the import of monetary gold last year, we may also predict that less currency will be required for import than last year," executive director said.
Gasimli stressed that the CBA's foreign exchange reserves perform only the macroeconomic functions of "stabilizer” and "financial airbag”.
The foreign exchange auctions have been held in the CBA this week jointly with the State Oil Fund of the Azerbaijan Republic (SOFAZ).
SOFAZ plans to offer $6.8 billion to the local market this year with the current rate for transfers to the budget and financing the improvement of housing conditions of IDPs.