ARMENIAN ECONOMIST: HAVING ANNOUNCED A FLOATING RATE OF THE NATIONAL CURRENCY, CENTRAL BANK OF ARMENIA ‘JUMPED FROM THE TENTH FLOOR’

ArmInfo
2009-03-04 12:11:00

ArmInfo. The national currency had to the transferred to a floating
rate even in the midst, 2008, a well-known Armenian economist, Director
of a Scientific- Research Center "Political Economy" Andranik Tevanyan
told journalists today when commenting on the Central Bank’s March
3 decision on returning the Armenian dram to a floating rate.

According to CB forecasts, the average dollar rate in 2009 is expected
within 360-380 AMD per US$1. To note, the dram rate to dollar increased
from 570-580 to 305 AMD/$1 during the last two years. A. Tevanyan
thinks that gradual increase of the Armenian dram rate from the midst,
2008 was the only way out of the situation developed as a result
of increase of its rate starting 2006. ‘The rate could be regularly
corrected, let us say by 5-10 drams, for which the Central Bank could
carry out moderate currency interventions which would be justified
for correction of the situation.

Then, this increase would be smooth at least and less painful. Now,
we have to jump from the tenth floor while we could go down stairs
at the proper time’, A. Tevanyan said.

He also said that formulation on to the floating rate conflicts with
the statements about a floating rate made during the last 1-2 years
by representatives of CB and government. ‘It was announced in 1994
that the Armenian national currency rate is floating. If there is a
decision on return to a floating rate, then where is a decision which
set a fixed rate?

Let CB representatives show it’, A. Tevanyan said.