YEREVAN, September 24. / ARKA /. Last week, the average exchange rate of U.S. dollar at NASDAQ OMX Armenia stock exchange dropped by 0.06% to 407.47 drams as the weekly trading amounted to $19.395 million, by almost 11 percent more than in the previous week. The average selling rate of cash greenback fell by 0.19% on September 22 to 408.80 drams. The stable situation in Armenia’s foreign exchange market is largely due to the ongoing high demand of importers and individuals for foreign currency against the background of growing devaluation sentiments.

In our opinion the U.S. dollar exchange rate in Armenia may increase slightly due to the ongoing domestic demand, as well as the flagging euphoria about the U.S. Federal Reserve’s new economy stimulating measures. An anticipated moderate growth of the U.S. currency in the foreign exchange markets will contribute to this. In this regard, the average selling rate of cash dollar in Armenia this week will be between 407.0 - 411.0 drams.

The cost of euro last week in Armenia was determined by developments at FOREX market, where the pair EUR/USD fell by 1.13% to 1.2977. Data on business optimism index in Germany from the Center for Economic Research ZEW, which almost coincided with the expectations of market participants, had little support for euro’s exchange rate. The average selling rate of cash euro in Armenia last week fell by 1.12% to 532.30 drams.

This week the cost of euro will be determined by economic news from the U.S. and the eurozone. The anticipated moderately positive statistics from overseas and weak data from the euro zone could put pressure on the euro value. However, if the final GDP figures and data on business activity index in the U.S. appear negative and the consumer price index in the euro zone appears to be higher than projected, the European currency may rise. The supposed volatility range of the euro this week is 1.2830 - 1.3100. This is why we expect the average selling rate of cash euro in Armenia to fluctuate within 525 - 540 drams.

The average selling rate of cash Russian ruble cash last week declined by 2.08% to 13.18 drams due to depreciation of the Russian ruble against the U.S. dollar amid falling oil prices because of the significant increase in U.S. oil reserves. The cost of ruble against U.S. dollar and, therefore, the Armenian dram this week will be depending on macroeconomic data from the U.S. and euro area, as well as the dynamics of oil prices. The average selling rate of cash rubles in Armenia this week is likely to be between 13.05 - 13.30 drams. M.M. -0-

Mikael Verdyan, GC FOREX CLUB analysts, specially for ARKA
The views of the author do not necessarily represent those of the agency