IMF: Azerbaijani authorities need to support move to floating rate (UPDATE)
Details added (first version posted on 10:43)
Baku, Azerbaijan, Dec. 22
By Anvar Mammadov - Trend:
It is important that Azerbaijani authorities support the move to a floating exchange rate regime by speeding up efforts to build confidence, says Mohammed El Qorchi, International Monetary Fund's mission chief for Azerbaijan.
"This would include enhancing the effectiveness of monetary policy, strengthening banking sector supervision and the use of macro-prudential policies to ensure financial sector soundness," El Qorchi told Trend Dec. 22 commenting on Central Bank's move on Dec. 21 to a floating rate for the national currency - the manat.
"Moreover, clear and consistent public communications will be important to anchor expectations about policy intentions and operations," he added. "In this regard, the IMF stands ready to provide technical assistance to help the authorities manage the new system."
"We welcome the recent action by the Central Bank of Azerbaijan to float the manat," he added.
"Greater exchange rate flexibility will enhance the authorities' policy framework and reduce pressures on reserves buffers, which have intensified sharply since mid-2015 as oil prices have continued to weaken," said El Qorchi.
Azerbaijan joined the IMF in 1992, and its officei n Baku was opened the same year.
Official exchange rate as of December 22 is 1.5511 AZN/USD and 1.6939 AZN/EUR.