Report: Central Bank cannot meet demand for currency - OPINION

Baku. 17 November. REPORT.AZ/ Growth in the USD exchange rate in Azerbaijan is associated with reduction in the supply of foreign currency in auctions by Central Bank of Azerbaijan.

Analytical Group of Report believes, funds in recent auctions do not meet demand by Azerbaijani banks

Thus, CBA regularly auctions 35 million USD in auctions that means monthly 240-275 mln USD.

However, that should be taken into account, the average monthly imports in 2016 made approximately 700 mln USD. The volume of imports in October was 756 mln USD.It means that currency supply in the best case meets 40% of demand.

Notably, closure of external debt obligations of companies in the last months, increase in imports due to the New Year, characterized by an increase in demand for foreign currency. Hence it can be concluded that the peak demand for the currency will reach at the end of the year.

Analytical Group of Report believes, the official exchange rate of US dollar in Azerbaijan can reach 1,85-1,90 AZN / USD by the end of this year. Notably dollar also strengthening in world markets due to the expectations about increase in interest rate in the US. The dollar is likely to stabilize in January and February. Thus, in January 2016 import was 434 mln USD, export was 542 mln in February. This makes 62% and 77% of an average annual figure respectively.