YEREVAN, July 8. /ARKA/. There is an increase in the supply of foreign currency in Armenia's currency market, said Armen Kotoyan, a member of the Central Bank of Armenia's Council, in an interview with CivilNet.
According to him, the Central Bank does not aim to manage the exchange rate or achieve any specific exchange rate target, as the main task of the regulator is to ensure price stability.
“If we look at the goals of the Central Bank, the key one is price stability. Managing the exchange rate or setting a specific target level for the rate is not within the functions of the Central Bank, and this is logical,” Kotoyan noted.
He emphasized that the Central Bank acts in cases where there is a one-sided movement in the currency market that significantly threatens market equilibrium.
Kotoyan pointed out that the increase in the supply of foreign currency is related, in particular, to the expansion of exports of certain services, an increase in demand for tourism services, capital inflows, and interest from non-residents in Armenian bonds.
He stated that in the first five months of the current year, the inflow of foreign currency into Armenia through the banking system amounted to about $2.8 billion compared to $2.3 billion in the same period last year and about $2 billion two years ago.
“The outflow is about $1.6–1.7 billion. This means that it is not growing at the same pace as the inflow. This indicates that the supply of foreign currency in the market is increasing,” Kotoyan said.
In response to a question about the main sources of inflow, he noted that funds come from Russia as well, but not only from there.
“There is significant activity from non-residents in acquiring bonds. If the instruments of the Armenian capital and financial markets become attractive to foreign investors, this is accompanied by an expansion of foreign currency inflow and an increase in its supply,” Kotoyan stated.
