Elman Rustamov: Central Bank not to allow the manat float freely

Baku. 22 December. REPORT.AZ/ Chairman of the Central Bank of Azerbaijan Republic, Elman Rustamov has said the bank will not allow the manat float freely, Report informs.

He said among the factors that provoked devaluation of the manat were the falling oil prices, and the depreciation of national currencies in Azerbaijan`s partner countries.

"The devaluation in some of our partner countries has exceeded hundred percent, which, naturally, has had its impact on the manat`s exchange rate." "For example, in the past three years, Iranian rial depreciated 120 percent, Kazakh tenge 108 percent, and Russian ruble more than two times. The manat depreciated just one time. We have serious trade relations with these countries. Serious pressure on the country`s currency market and the manat`s exchange rate resulted in the depreciation of the manat this February. Economy, currency market, manat exchange rate were adjusted to the oil price of 50-55 US dollars per barrel."

Rustamov said the current situation necessitated the adjusting of the manat`s exchange rate to the new price of oil. So today we decided to shift to a floating exchange rate. But it is managed floating. The Central Bank will not allow the manat float freely." 

"Today we held our first auction. We also changed the operational framework of the exchange rate", he said.

He also revealed plans to take measures to strengthen the banking sector stability.