Armenian dram keeps on losing its value

11.12.2020 17:27
Armenian dram keeps on losing its value

YEREVAN, December 11. /ARKA/. The Armenian dram continues to devalue and the economic situation is difficult, Edgar Karapetyan, director for strategy and innovation at Galaxy Group of Companies, wrote on his Facebook page. He said the US dollar is already trading at 520-525 drams.

“Many people ask why the Central Bank does not take action to restrain the devaluation of the dram. To do this, it is necessary to present the whole picture. In particular, over the past 3 months, Armenia's international reserves have decreased by $381 million to about $2.3 billion as of late November (about 20% of GDP and 45% of imports). There is no doubt that the reserves were used in the domestic market to restrain the dram's devaluation against the US dollar,” Karapetyan said.

In addition, according to him, in the next three months, the Central Bank will have to pay off loan obligations in the amount of $1.1 billion, as a result of which state reserves will decrease, at best, to $1.1 billion (about 10% of GDP and 22% of import).

“This indicator is already risky enough,” Karapetyan said. He also noted that the ratio of public debt to GDP at the current rate is already 67.4%, which, according to international organizations, is also a risky indicator.

According to him, only 47% of government treasury bonds were placed the day before, with an average yield of 7.6% (2% higher than in the summer).

“Thus, the country is experiencing a significant economic recession, a reduction in state budget revenues, a significant increase in government spending, and inadequate government administration. At the same time, there is no necessary financial inflows such as investments, exports and remittances and there is no trust in the government,” Karapetyan said. -0--

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Tags: , Новости Армении АМИ Новости-Армения

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