Armenia: forex market review for May 13-18

20.05.2013 16:30
Armenia: forex market review for May 13-18

YEREVAN, May 20. / ARKA /. Last week the average exchange rate of U.S. dollar at NASDAQ OX Armenia stock exchange rose by 0.18% to 417.24 drams while the weekly trading amounted to  $12.8 million, an increase of 85.51% over the previous week, although no deals were made at the exchange for four days. The average exchange rate of cash dollar increased by 0.18% on Sunday, May 19 to 418.53 drams. This behavior of the U.S. currency was primarily due to the continuing demand for foreign currency on part of businesses and individuals, as well as moderate devaluation sentiments in the market.

This week the U.S. dollar has every reason to increase up to 420.0 drams. However, towards the end of the week, the Armenian currency may again recover a little, thanks to intervention of the Central Bank in the foreign exchange market. The increasing amount of purchases of greenback by businesses and individuals may also contribute to the growth of the U.S. currency. According to the Central Bank of Armenia, net sales of USD by local commercial banks last week amounted to 12.716 million, four times more than the previous week. According to our estimates, the average selling rate of cash dollar this week is likely to be between 415.0 - 421.0 drams.

The cost of the euro last week in Armenia was defined by developments at global currency markets where the EUR / USD dropped by 1.17% to 1.2836, and the dynamics of Armenian dram relative to the U.S. currency. After a bumpy start of trading last week the single European currency suffered severe losses amid weaker-than-expected economic data from the euro zone. Indeed, the EU GDP in the first quarter of the year was again in the negative territory, dropping by 0.2%, whereas the German economy saw a slight increase. In addition, signs that the recovery of the world's largest economy is gaining momentum do not allow investors to relax, thereby putting pressure on the cost of the main currencies. Against this background, the average selling rate of cash euro in Armenia last week fell by 2.06% to 539.83 drams.

The average selling rate of the Russian ruble last week declined by 0.88% to 13.45 drams due to a decrease in the value of the Russian ruble against the U.S. dollar at international currency markets. -0-

Mikael Verdyan, analyst of FOREX CLUB, special for ARKA.
The views of the author do not necessarily represent those of the news agency.

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