YEREVAN, March 19. /ARKA/. U.S. dollar’s average exchange rate at NASDAQ OMX Armenia stock exchange fell last week by 0.37% to 388.73 drams. The weekly trading amounted to $12.3 million, which was 20.8% less than the previous week. The average selling rate of cash USD dropped by 0.33% to 390.15 drams on March 17. This behavior was due to the intervention of the Central Bank of Armenia which sought to shore up the national currency. The greenback’s behavior was also due to a decrease in the value of U.S. currency at the global FOREX market against the backdrop of improved market sentiments.
The depreciation of the dollar may continue this week, as market participants may be wary of another intervention of the Central Bank of Armenia. The U.S. exchange rate may be affected also by declining demand for foreign currency in Armenia. Indeed, according to Central Bank’s weekly review, a total of 1.653 million U.S. dollars were sold and bought at inter-bank market last week, which was 83.61% less than the previous week. The average selling rate of cash dollar this week probably will be within 387 - 392 drams.

The cost of euro last week in Armenia was determined by developments at the global currency market FOREX, where the EUR/USD rose 0.46% to 1.3173. However, in the first half of last week the European single currency fell in value, reaching four-week minimum of 1.3002, as the outcome of U.S. Federal Reserve meeting, held on Tuesday, March 13, dispelled the expectations of market participants about new measures to stimulate the economy. But in the second half of the week the euro managed to recover its position after an increase in yield on U.S. Treasury bonds stopped, and market participants recorded their profits before the weekend.

In Armenia, the average selling rate of euro cash past week, by contrast, fell by 0.7% to 513.35 drams, due to retarded impact of euro dynamics on the local foreign exchange market due to the limited trading session time. On March 19 the average selling rate of euro cash will likely be adjusted upward to 515.50 drams.

If economic statistics is positive, the euro at FOREX market is likely to rise to 1.3350. But if economic data are negative the euro may fall to a level of 1.3050. In this regard, the average selling rate of euro cash in Armenia this week will be within 507.0-525.0 drams.

The average selling rate of cash Russian ruble last week declined by 0.15% to 13.23 drams due to decrease in its value against the U.S. dollar, as well as the growth of Armenian dram.

The cost of the ruble against U.S. dollar and, consequently, the dram this week will depend on emerging macroeconomic statistics from the U.S. and the eurozone, as well as the dynamics of oil prices. Even if the economic data is mixed, high oil prices will support the ruble. The average selling rate of the cash ruble in the next five trading days is likely to be within 13.10 - 13.35 drams. M.M. -0-

Mikael Verdyan, an analyst for FOREX CLUB, specially for ARKA. The opinion of the author may not necessarily represent that of the agency.