Devaluation: Azerbaijan currency loses 34% value
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BAKU:
Azerbaijan’s central bank on Saturday sharply devalued the energy-rich country’s currency as falling oil prices and economic turmoil in Russia hit hard across the former Soviet Union. The Azerbaijani manat lost 34% of its value against the dollar and 33.8% against the euro in the cut, with new exchange rates set at 1.05 manat and 1.195 manat respectively. The move aims at creating additional stimuli for economic diversification, boosting competitiveness and exports. With oil and gas accounting for 95% of the country’s exports and 70% of state revenues, the Azerbaijani economy has been under pressure from falling oil prices since June. In December, the central bank spent some 8% of its international reserves to defend the manat, and reportedly as much as $1 billion so far this year. On Monday, the central bank moved to abandon its currency peg to the dollar in favour of a euro-dollar basket.
Published in The Express Tribune, February 22nd, 2015.
Azerbaijan’s central bank on Saturday sharply devalued the energy-rich country’s currency as falling oil prices and economic turmoil in Russia hit hard across the former Soviet Union. The Azerbaijani manat lost 34% of its value against the dollar and 33.8% against the euro in the cut, with new exchange rates set at 1.05 manat and 1.195 manat respectively. The move aims at creating additional stimuli for economic diversification, boosting competitiveness and exports. With oil and gas accounting for 95% of the country’s exports and 70% of state revenues, the Azerbaijani economy has been under pressure from falling oil prices since June. In December, the central bank spent some 8% of its international reserves to defend the manat, and reportedly as much as $1 billion so far this year. On Monday, the central bank moved to abandon its currency peg to the dollar in favour of a euro-dollar basket.
Published in The Express Tribune, February 22nd, 2015.