In a report just published, Azerbaijan's Centre for Economic and Social Development (CESD) says that it does not expect another devaluation of the country's currency, the manat, in the short term.
In the report, written by one of the Centre's analysts, Rashad Hasanov, CESD says that stability in the currency exchange market is not sustainable since the exchange rate is established as an administrative measure rather than a reflection of the market demand. The process through which the Central Bank fixes the rate of exchange is not transparent. The report suggests that there is lack of trust among the public in the financial institutions, especially the Central Bank. The Bank, the report says, has failed to communicate its message properly to the markets and the public. However a number of factors are contributing to keeping the currency at its current level, including an increase in the price of oil, better balance of payment figures and increase in the country's foreign currency reserves, among others.
But the report says that the market remains jittery. A recent announcement by the Central Bank that Saturday was to be a working day, in lieu of a religious holiday that fell in the middle of the week, brought back memories of the last devaluation resulting in some panic.
You can read the full report on the CESD website here
source: commonspace.eu with CESD.az
photo: The Central Bak of Azerbaijan (archive picture)
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