Why 1$ is 1,05AZN?

Most experts connect the decision of the Central Bank to devaluatie the national currency relatively  to the US dollar at a level of about 34%,  with not good intentions to support a competitive national economy and support the export potential, but by an attempt to fill those financial losses  which  the State budget  has faced due to lower oil revenues. Experts can  give answer to the question "why manat"  is lowered "to 1.05 with respect to the $ 1".

An economist Togrul Aliyev said that the government has gone the way of Russia, which in November 2014 devaluated  ruble  in ratio to dollar at a level that provides revenues that allow the execution of the state budget in rubles. On the example of Azerbaijan on  February 20  the situation was as follows: Brent "Azerilayt" on the London Stock Exchange was worth $ 61.89 / barrel, or 31.23% less than the inherent in the state budget. The next day the decision on the establishment of the official exchange rate of the dollar at 1.05 manat for $ 1, which is by 33.93% more than incorporated in the main financial document of the country.

Samir Aliyev , expert  of the Center for Support of Economic Initiatives, said that overnight amount of the state budget, expressed in dollars, has decreased  from $27 billion up to $ 20 billion. "If you take one more step we can bring costs up to $ 18 billion," he said, keeping in mind the possible reduction of the investment costs.

Economist Fariz Huseynli requires the CBA to provide the results of analyses, according to which just this rate of manat is able to change the balance of payments and non-oil exports in favor of the economy. If it is so, "then by this step the CBA suspends excitement of buying the dollar and perserves its currency reserves," he said.

The scientist- economist Azer Mehdiyev explained the devaluation in accessible language for the layman. Transfers of the State Oil Fund to the state budget should amount to 10 billion 388 million manats, or $13 billionm 318 million accordign to the previous rate. And today's exchange rate requires only $ 9.9 billion, by $3.4 billion less. "If we add here the "inflation tax" then the government  with great pleasure  will report on the growth of tax revenues from the oil sector, says sarcastically Mehdiyev.

Analyst Gubad Ibadoglu believes that this year's inflation rate will be by  several times higher than the projected level of government. Living standards, social indicators, social relationships of the population with the government are worsening. Those who have deposits in banks in local currency will have losses. Public confidence in the government and the banking system will fall,  dollarization of the economy, non-cash payments will increase, emphasized Ibadoghlu.

Original views on the situation  came from  the economic analyst of the newspaper «Ekspress» Vasif Jafarov. According to him, after the hype around buying dollar in the society fall, the dollar will fall again, and the CBA will offer more manat. Gradually, the dollar exchange rate will be closer to  0.90 manat, Euro - will stabilize at the rate1.05 manat.-08A-