Thursday, March 18 2010 18:34
Serious interference of Central Bank of Armenia has calmed down the currency market
ArmInfo. Serious interference of the Central Bank of Armenia has calmed down the currency market, having decreased the exchange rate from yesterday's 408 AMD/1 USD to 405 AMD/1USD in the average.
The currency market participants told ArmInfo that this has cardinally ruled out any possible speculative processes, and the situation with USD purchase and sale has gone back to normal. Today a total of $20.8 mln were injected in the stock exchange at the average exchange rate of 405 AMD/1USD. Judging by the volume, this was most likely done by the Central Bank. At the beginning of the trade session, decline in quotes was already observed at many banks, especially, large ones, in particular, in sale of USD – by 4-5 pct points from 411-412 to 406-407, which, in
its turn, decreased the considerable spread between the exchange rates of sale and purchase from 6-7 pct points to 3-4 points. After closure of the trade session, the USD purchase/sale exchange rate is currently 403/406 AMD/ 1 USD.
According to the market participants, the considerable injection of the USD stock gave an opportunity to the banks to satisfy the clients' applications for currency purchase, whereas yesterday the banks were deprived of this because of the abrupt upswing of USD. As a result, the marker has calmed down, and one managed to satisfy the population's March 17 demand for USD. The retail currency dealers expect that US dollars will be injected tomorrow as well, but much less than today, however, even this stock will maintain the currency market in a normal state for the weekend.
To recall, on March 17 the AMD/USD exchange rate in Armenia exceeded 400 AMD/1 USD and made up 408 AMD/1USD in the average by Wednesday evening, having thereby grown by 12-13 pct points over the day. That day the currency market is currently non-liquid; banks display high demand for currency by the demand of the clients.
Despite the demand, the interbank currency market behaved quite passively, having ensured $300 thsd. The market participants think that such modest participation in the stock exchange did not stop the raising trend, as a result, the USD exchange rate continued growing. Before closure of the stock exchange, the exchange rate in the retail currency market made up 404/408, and after closure of the auction, it rose to 406/410. According to the retail currency dealers, no panic is observed among the population, however, if the CBA failed to interfere in the situation today, the high demand for USD would be maintained.
To note, gradual growth in the exchange rate has been observed since last week. Thus, if on March 9 the USD exchange rate in the retail
currency market was 388/393 AMD/1USD, last Saturday, March 13, the average purchase and sale exchange rate was 394/396 AMD/1 USD. Last week (9-12 March) currency purchase and sale operations worth $15.803 mln were carried out at the stock exchange at the average exchange rate of 391,79 AMD/$1, on March 15 - $6.1 mln at the average exchange rate of 396,94 AMD/$1, and on March 16 not a single operation was carried out.
Expert: Electricity tariff containment in Armenia is only temporary
Political Scientist: Armenia`s withdrawal from Eurasian Economic Union (EAEU) to result in its dependence on Azerbaijani and Turkish markets
Artur Avetisyan: All discussions regarding the choice of a future NPP model will remain mere talk until there is a vision for strategic development
ATI.SU: Demand for international cargo transportation 30% up in Armenia
Civil Contract nominates Armen Ktoyan for Central Bank Board Member position
Armenia, France considering prospects for expanding technological cooperation 
Over 99.9% of wheat imported to Armenia comes from Russia