ArmInfo.The Central Bank of Armenia has repeatedly announced its intention to carry out interventions in the foreign exchange market. This is stated in the message of the Central Bank of the Republic of Armenia spread on December 15. The report also notes that the Central Bank of Armenia continues to monitor financial markets and, if necessary, will apply all the tools in its arsenal, guaranteeing price stability and financial stability.
To note, the previous announcement by the Central Bank of its intention to enter the foreign exchange market with interventions was made on November 24 this year. Prior to this, a noticeable devaluation of the dram began to be observed in the retail foreign exchange market of Armenia from the second decade of October this year, with the approach of November 18 close to the mark of 500 AMD / $ 1 on average, and the next day the exchange rate of the AMD against the dollar has already exceeded 501 AMD / $ 1 and by November 23 it reached 507 AMD / $ 1 on average, continuing to weaken more pronounced. Thus, on November 24, the dram exchange rate against the US dollar jumped to 516 AMD / $ 1 on average, against the euro - to 612 AMD / 1 EUR, and against the ruble it rose moderately to 6.9 AMD / 1 RUB.
However, after the announcement on November 24 by the Central Bank of its intention to conduct interventions in the foreign exchange market, a slow strengthening of the dram has already been outlined since November 26, and by December 1 the dram strengthened against the dollar to 507 AMD / $ 1 on average, against the euro - to 607 AMD / 1 EUR, and against the ruble - up to 6.7 EUR/ 1 ruble, continuing this attitude and on December 2 - respectively up to 506.5 AMD / $ 1 and 605 AMD / 1 EUR, and "frozen" to the ruble at 6.7 AMD / 1 ruble. But already from December 3, the dram devalued again to 511.5 AMD / $ 1, 619 AMD / 1 EUR and 6.9 AMD / 1 RUB, with the continuation of this trend in the following days, and by December 11 the dram weakened against the dollar to 521.5 AMD / $ 1, against the euro - up to 634 AMD / 1 EUR, against the ruble - up to 7.2 AMD / 1 RUB. And already on December 15, the dram devalued against the dollar and euro to 528 AMD / $ 1 and 640 AMD / 1 EUR, while maintaining its position against the ruble. To note for comparison that at the end of 2019, the AMD exchange rate against the US dollar was 479.3 AMD / $ 1 on average, against the euro - 531 AMD / 1 EUR, against the ruble - 7.7 AMD / 1 RUB.
According to the Central Bank of Armenia, in January-September 2020, the Central Bank made interventions in the foreign exchange market for a total of $ 217.9 million, of which $ 90.9 million was bought (January-February and April) and $ 127 million sold (March-April), and during this period, the dram against the dollar from January 479.09 AMD / $ 1 reached the April 493.1 AMD / $ 1 (purchase / sale). And if in January-February interventions in the foreign exchange market were exclusively for the purchase, and in March - only for the sale, then in April the Central Bank carried out operations for the purchase and sale, and the volume of sales was almost 2-fold higher than the volume of purchases, which formed the course purchases at the level of 481.66 AMD / $ 1 and sales at the level of 504.45 AMD / $ 1. In May-September, the Central Bank did not perform operations on the foreign exchange market. Since the announcement (November 24) by the Central Bank of its intention to carry out interventions up to December 12, in the foreign exchange interbank market, banks have made dollar transactions in the amount of $ 3.650 million in total, of which $ 2.150 million fell on the first week of December. In November, the foreign exchange interbank was idle for 11 days, of which 9 days fell on the period until November 25. In total, from November to December 12, the foreign exchange interbank was empty for 17 days. And the dram continued to weaken against the dollar and the euro, and is now more pronounced, while maintaining a relatively moderate devaluation trend against the ruble. The foreign exchange interbank operating in December the first week (only 3 days), followed by a weekly silence, showed weak signs of activity on December 14 - "highlighting" the modest volume of dollar transactions for $ 272.8 thousand at the rate of 520.62 AMD / $ 1, while on the intrabank market the volume of purchases and sales of the dollar reached $ 39.4-38.6 million at a purchase rate of 521.09 AMD / $ 1 and a sale rate of 523.89 AMD / $ 1 (on average 522.49 AMD/ $ 1).
It should be reminded that since September 27, Azerbaijan began military operations in Nagorno-Karabakh, which demanded maximum mobilization of resources from Armenia. However, the actual surrender of the Armenian side with the signing of an armistice agreement on the night of November 9-10 with the loss of the entire NKR security belt consisting of seven regions and part of Artsakh itself led to the destabilization of the internal political situation in Armenia and some economic imbalance. Moreover, most likely, to get out of the current situation, Armenia will have to go for new foreign borrowings, a difficult process of economic financial stabilization, which naturally could not but affect the situation on the foreign exchange market.
