Over the past few days, the value of the dollar in our country has been going down day by day. The Armenian dram’s value has increased. As of today, one dollar was equivalent to 500 AMD, but a few days ago, it was 518-520 AMD.
Economist Suren Parsyan answered Aravot Daily’s question of whether the political processes taking place in our country are connected with dram-dollar fluctuations and what other factors are conditioned by such sharp fluctuations. “First of all, in the summer, we have a decrease in the dollar exchange rate due to the flow of tourism and the sale of agricultural products. These are the sources of income that are increasing this season and flowing to Armenia in dollars.” The second factor, according to Suren Parsyan, is that this year, unlike last year, our compatriots went abroad for more work and remittances from abroad have increased this year. “In other words, people send more money to their relatives than last year. The third factor is that the government was $804 million more in debt in the first four months of this year alone, mostly in dollars.
That dollar was brought to Armenia, where it was converted into AMD and spent on paychecks, pensions, etc., which, of course, affects the foreign exchange market. The other factor is that in recent months, the Central Bank has taken a number of tough measures to curb inflation by reducing the refinancing rate in particular, as a result of which the AMD has appreciated. The Central Bank imposed a number of restrictions on bank deposits, dollar deposits, issue of bonds, and placements. In other words, the Central Bank did everything possible to keep the banks with less dollars and more AMD, and with that, the dram appreciated,” said Suren Parsyan. According to him, the growth of exports also had a significant impact on the process of decreasing the dollar exchange rate. “In five months, we had a 20.8% increase in exports. In May alone, compared to May last year, exports increased by 38.7%. May last year was a crisis year, the economy was closed, it was in a lockdown, and that’s why they brought in more dollars this year. In addition, metal prices have risen, which allowed us to bring more dollars to Armenia.”
Is the dollar exchange rate expected to decrease again? Mr. Parsyan said that it cannot decrease sharply, because it is not beneficial for anyone, especially the exporters. “They are suffering as a result of the dram’s revaluation.”
According to Suren Parsyan, the dram’s revaluation, however, did not lead to a decrease in consumer goods prices, which should have happened. “This is due to the fact that our markets are monopolized, and the companies that import goods have no competitors and are not interested in lowering prices. They will keep the price as high as they can. In other words, when the dram was depreciating, they quickly raised the price, but they did not do the opposite.”
Lusine Budaghyan
