Efforts to Curb Currency Devaluation Aim to Assure Investors

The exchange rate of the dram continues to be a concerning phenomenon for citizens and entrepreneurs. In fact, over the past two months, the dram has devalued by about 8 percent. However, it is noteworthy that there were fluctuations where the dram's exchange rate would crash, then stabilize, only to resume its devaluation.

According to experts, these 'pauses' in devaluation are due to the government’s efforts to prevent depreciation at all costs. The 'Hayastani Pasti' newspaper reports that, according to our sources, there is a primary reason behind this. Information suggests that a new issue of eurobonds totaling around half a billion dollars is expected soon, and in order not to scare off foreign investors, the authorities are doing everything possible to create the impression that the macroeconomic environment in Armenia is stable, including the exchange rate of the dram.

To achieve this, the government has been continuously injecting dollars into the market from Armenia's international reserves during this period. Sources indicate that this involves approximately 150 million dollars. Regarding the eurobonds, their purpose is to fill a significant gap in the budget, essentially increasing Armenia's external debt once again.

Interestingly, experts believe that following the sale of eurobonds, the devaluation of the dram will accelerate, as there are no resources to support it, and there will also be a lack of interest to do so.

For more details, see this issue of the newspaper.