Report: Azerbaijan does not need a full transition to floating rate of manat

Baku. 26 December. REPORT.AZ/ Azerbaijan does not need a full transition to floating rate of manat envisaged in the " Strategic Road Map for prospects of the national economy of the Republic of Azerbaijan ".

Analytical Group of Report believes, steps on devaluation of the national currency manat, or transition to the "floating rate" associated with the pressure on the balance of payments. In Azerbaijan, this deficit has already been fixed in 2nd and 3rd quarters.According to official statistics of the Central Bank of Azerbaijan (CBA), in 2nd quarter, the balance of payments ended with a surplus of 18 million in 3rd quarter -. 63 million dollars.This means that in 3rd quarter foreign currency reserves of Azerbaijan increased by 63 mln USD.

In case of full transition to the floating rate of manat Import to Azerbaijan will be reduced even more and the balance of payments surplus will continue to grow in view of the stability of the current oil prices.However, this will lead to a weakening of the trade activity in the country and the period of stagnation due to the erroneous predictions of entrepreneurs on manat rate.As a result, jobs will be reduced, the cost of rents and retail properties will decrease.

Analytical Group of Report believesthe most appropriate rate at the current oil prices is 2,00 AZN / USD.The stabilization of the course at this level will help to revive the economy, the resumption of lending in national currency. The need for a course correction could occur in the event of falling oil prices.Thus, if the full transition mode will be implemented, fall in oil prices will further accelerate the devaluation of the manat.