As transactions on stock exchange and foreign exchange inter-bank market shrink, national dram devaluates

ArmInfo. As transactions on stock exchange and foreign exchange inter-bank market shrink, national dram has devaluated. Thus, on October 12-16, the forex transactions on NASDAQ OMX Armenia shrank 4-fold, yielding to the volume of the interbank forex market, which saw a 30,5% decrease. As a result, Dram after September appreciation from 484 up to 473 AMD/1USD, started devaluating in the second half of October making up 474AMD/1USD on October 16

According to the CBA press office, on October 12-16, the transactions on NASDAQ OMX Armenia totaled $1.550 mln, forming an average exchange rate of 474.26 AMD/$1.  The banks were active on the stock exchange throughout the week, except Thursday. The transactions on the forex interbank market within the week under review totaled $5.1 mln., forming the exchange rate at the level of 473.48AMD/1USD in average.  The Central Bank made no intervention either last week or the current week. The last intervention of the Central Bank was on  Oct 2 - $6 million, on Sept 19 - $22.2mln, and on August 28 -$95 mln.

The source says that on October 12-16, in the intrabank currency market (transactions with customers) the banks bought $66.4 mln (up 15.9% versus the previous week) at the average exchange rate of 472.75 AMD/$1, and sold $77.5 mln (down 12% versus the previous week) at the average exchange rate of 474.38 AMD/$1. In the meantime, the banks bought 6.7 mln EUR (up 15.5%) at the average exchange rate of 536.48 AMD/1EUR, and sold 7.7 mln EUR (down 30%) at the exchange rate of 542.36 AMD/1EUR. The banks also bought 1.3 bln RUR (15.6% weekly decline) at the average exchange rate of 7.60 AMD/1RUR and sold 266 mln RUR (19% weekly decline) at the exchange rate of 7.72 AMD/1RUR.

During the previous week -  October 5-11 - the Armenian banks provided AMD loans worth 33.4 bln AMD and USD loans worth $24.4 mln.  As compared with the previous week (28 September - 4 October), AMD loans decreased 49% and the ones in terms of USD - 66.4%. 

To recall, during the last months of 2014 the forex market of Armenia registered a sharp rise of the AMD/USD exchange rate - over 570 AMD/1USD. From October through December 17, 2014, AMD depreciated by almost 45% in the retail forex market of Armenia, then it appreciated by 25% on Dec 18-20, staring depreciating against on Dec 22.  On Dec 27, the average AMD/USD exchange rate was 470 AMD/$1, the AMD/EUR exchange rate was 574 AMD/1EUR, the AMD/RUR exchange rate was 8.7 AMD/1RUR. Over 2014, NASDAQ OMX Armenia registered transactions worth a total of $744.5 mln, with the biggest amount falling on November ($117 mln). Over the year the exchange rate on NASDAQ OMX Armenia rose from 407.14 to 560 AMD/$1 (on Dec 17 the exchange rate rose by 22%), dropping to 470 AMD/$1 by Dec 27. In 2014, in the retail forex market of Armenia, the AMD depreciated against USD by 40%, with the maximum indicator (570 AMD) fixed on Dec 17 and the minimum (406 AMD) registered in July. In the course of the 9 months of 2015, in the retail forex market AMD appreciated from 477 to 473 against USD; from 571.5 to 532 against EUR, at the same time depreciating from 8.2 to 7.2 against RUR. By October 16, dram/dollar rate fell to- 474 AMD/1$ in average. The national currency depreciated against EUR and RUR:  up to 538AMD/1EUR and 7.8AMD/1ruble, respectively.