Friday, April 29 2011 12:14
Central Bank of Armenia to remain loyal to floating rate policy
ArmInfo. "We will remain loyal to the floating rate policy, admitting no abrupt fluctuations in the market", Chairman of the Central Bank of Armenia (CBA) Artur Javadyan told journalists on April 28 when commenting on the CBA's further behavior against the background of the Armenian president's statements about the necessity of gradual devaluation of AMD to support exporters.
The CBA chairman stressed that the president's statement about gradual devaluation of AMD belongs to the long-term outlook. "Certainly, a good environment is created for exporters in case of AMD devaluation, and for importers - in case of revaluation", said Javadyan and added that it is very difficult to choose the midpoint, especially when the CBA is conducting a floating rate policy.
Javadyan pointed out that a number of factors, particularly, the seasonal factor, expectations for transfer flow growth, and output growth in agriculture may lead to a small appreciation of AMD. "But we can interfere in these situations as well, why not", he said.
When speaking of the CBA's policy of economy dedollarization, Javadyan said that the megaregulator continues the fight against dollarization and quite serious measures have already been taken in this dimension and will be taken in the future as well. He pointed out that in 2011 the dollarization level of economy has slightly declined.
To recall, according to the CBA, in the total volume of crediting of the real sector of Armenia the share of foreign exchange loans made up 56.8%, having increased by 0.2% in Jan 2011 and by 5.9% annually. In Q1 2011 the banking system of Armenia provided loans worth 55 bln AMD, of them foreign exchange loans were equivalent to 44 bln AMD. In Q1 2011 the currency deposits grew by 7.3% (6% - exchange rate fluctuations exclusive), while the AMD deposits increased only by 0.7%, which led to 4.7% reduction in AMD stock and 0.5% growth in monetary stock.
The AMD stock has annually grown by 22.8%, and the monetary stock - by 11.9%, the AMD deposits - by 40.4%, and foreign exchange deposits - by 1.2% (by 8.5% exchange rate fluctuations). As a result, dollarization annually declined by 9.6%.
To note, since the beginning of 2011, the USD exchange rate against AMD grew by almost 8% from 363.1 AMD/$1 in early January to 371.18 AMD/$1.
