CENTRAL BANK OF ARMENIA SEES NO DANGER IN PUTTING BANKNOTE OF AMD 100,000 IN CIRCULATION
ARKA
Aug 24, 2009
YEREVAN, August 24. /ARKA/. The Central Bank of Armenia sees no danger
in putting the AMD 100-thousand banknote in circulation. He doesn’t
think this can trigger inflation.
Vakhtang Abrahamyan, member of the Central Bank’s board, told
journalists on Monday that there are at least two reasons for ruling
out such a threat.
"Experience shows that the biggest banknote worth 50,000 drams has
filled its niche of 7% in cash turnover. We expect the newly issued
banknote of 100,000 drams will occupy the niche of 3%. This can’t
trigger inflation or alter exchange rates", he said adding that any
economic entity would become able to conclude large deals in the
national currency.
Besides, the experience of Lithuania, whose biggest banknote’ value is
equal to â~B¬1,000, shows that the existence of a great-value banknotes
gives room to avoid conclusion of big deals in foreign currencies.
"Economic downturn doesn’t mean shrink in big transactions. More
than that – it is very favorable moment for concluding such deals",
Abrahamyan said.
National Statistical Service of Armenia says 2.7 percent inflation
was recorded in the country in Jan-July 2009, compared with the same
period a year earlier.
Consumer prices grew 2.4% in July 2009, compared with December
2008. Accordi ng to the statistical report, 2.7% deflation was recorded
in July, compared with the previous month.
Money supply in Armenia grew 1.19% or by AMD 7.8 billion in June,
compared with May, reaching AMD 662.7 billion by late June. Cash
outside the banking system totaled AMD 236.2 billion by late
June against AMD 226.7 billion earlier that month. ($1 = AMD
375.28).
From: Emil Lazarian | Ararat NewsPress
