Strengthening of Manat Temporary - Natig Jafarli

Strengthening of the manat can be regarded as a temporary phenomenon, and soon the depreciation of the national currency will continue, said the executive secretary of the movement Republican Alternative (ReAl), economist Natig Jafarli.

In an interview with Turan the expert noted that in contrast to the global financial markets, where the fall of the dollar is due to the domestic US problems and solutions of President Trump, in Azerbaijan it is the result of an administrative decision.

“Strengthening of the manat has no economic justification. The country completely depends on imports. Azerbaijan receives dollars only through the State Oil Company,” he said.

The economist believes this is the result of the Central Bank’s tightening monetary policy. Reduced money supply actually creates a deficit of AZN. The central bank saves AZN by deposit auctions.

Jafarli noted that since the second half of February the budgetary expenditure will begin, in connection with which the amount of AZN will increase. According to him, it should be noted that in March in connection with the Novruz holiday there will be nine days off and many people will prefer to go abroad. This, according to the economist, in turn, will increase the demand for foreign currency.

Note that after the continuing decline of the manat, which began in October 2016, at the beginning of February, the national currency strengthened slightly.

At present, the official exchange rate is 1.9111 manat per dollar. The commercial banks are buying the US currency from the population at 1.86-1.88 manat and sell it at 1.92-1.94 manat.   -------71D