Armenian National Currency Suffered No Sharp Fluctuation Despite Exp

ARMENIAN NATIONAL CURRENCY SUFFERED NO SHARP FLUCTUATION DESPITE EXPECTATIONS: HSBC BANK ARMENIA CEO SAYS

ArmInfo
2009-06-02 13:08:00

Armenian national currency suffered no sharp fluctuation despite
expectations, Tim Slater, HSBC Bank Armenia CEO, said in an interview
with ArmInfo.

He said that since the devaluation in March, the national dram has been
within the Central Bank’s target zone for almost three months. Hence,
depositors will begin exchanging their savings into national currency
as trust in the Armenian dram is gradually regained. T. Slater sees
some prerequisites in this context. In addition, T. Slater is sure
that the interest rates for bank products will be considerably changed
as well. He thinks that the interests for dollar products will be
reduced whereas the high interests of dram products will be left
unchanged. The different between the interests of dram and dollar
products at HSBC Bank Armenia is 5%, T. Slater said.

On March 3 2009 the Central Bank of Armenia announced return
to floating rate policy. The same day the Armenian dram sharply
devaluated – 22%. The exchange rate sharply grew from 307 to 375
drams/1 US dollar. As of June 1, the exchange rate at retail market is
370 drams/1US dollar. Armenian CB forecasts 360-380 drams/1US dollar
exchange rate in average for 2009.

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