National Bank of Georgia plans to start interventions of foreign exchange market
Baku, Azerbaijan, August 1
By Tamilla Mammadova – Trend:
The National Bank of Georgia (NBG) plans to sell $40 million on exchange auction on August 1 as the Georgian lari continues to devalue, Trend reports via the National Bank of Georgia.
As a response to the sharp depreciation of Georgian currency the National Bank of Georgia (NBG) plans to start interventions of foreign exchange market.
NBG made a statement saying that the exchange rate has come to the level that can worsen the expectations over Georgian economy and can have a negative impact on inflation.
In a statement the NBG said “despite the positive internal and external macroeconomic dynamics” today’s exchange rate has reached a level “that might pose a risk to price stability” amid “the tourism-related shocks and negative expectations”.
It also said that the bank would use all means at its disposal “to avoid materialization of this risk”. It also noted that if needed, the National Bank will again intervene on the currency market in the coming days.
“In case of maintenance of the pressure coming from the exchange rate, the National Bank will also tighten its monetary policy,” the statement reads.
Head of the NBG Koba Gvenetadze said that external factors and lack of tourists have made an impact on the exchange rate of the national currency.
Gvenetadze also said that NBG would get involved and use “its levers” against the increased rate of exchange of the lari whenever necessary.