Payment balance surplus in Azerbaijan allows manat rate to remain stable
Azerbaijan, Baku, May 20/ Trend , I.Khalilova /
The Central Bank of Azerbaijan assessed the currency market of the country as stable, the elements of the devaluation of the currency is not recorded, said the Acting Director General of the Central Bank of Azerbaijan (CBA) Khagani Abdullayev.
"In the first two months of 2009, the neighboring countries experienced a series of devaluations of national currencies, but our research has shown that the payment balance in Azerbaijan is at an acceptable level, and despite double decline in surplus of the current fiscal balance compared with the previous year, this surplus fully covers the deficit of the capital account," said Abdullayev.
"We see no need for correction of manat rate in the conditions of balancing the payment balance. Held by the CBA, the studies indicated that the negative sides of the change of rate are greater than the positive," he said.
"Therefore, we give preference to the continuation of the rate policy in a stable regime in the future," said Abdullayev.
According to him, Central Bank intervention in the monetary market since the beginning of the year amounted to nearly $1 billion, but the process was stopped since mid-April.
"The analysis showed that sales of the currency does not affect the payment balance, but just against, it led to the dollarization of cash, which was connected with the psychological factor of devaluations in neighboring countries," said Abdullayev.
Since May, the Central Bank has already started to buy currency that allows to restore monetary reserves. The Director said that according to the results of research, with the price of oil at $50 per barrel, the country's payment balance surplus as a result of 2009 will be $5 billion, and currently the price is approaching $60, which will lead to further growth of surplus.
"As the rate is a fundamental factor in the payment balance, the surplus which continued to grow, we see no economic justification for the correction of the national currency," said Abdullayev.Do you have feedback? Contact our journalist at: [email protected]