National Bank: Lari devaluation temporary, caused by false expectations
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Georgia’s National Bank (NBG) has released a statement in which it explained that the current devaluation of the national currency, the lari, is temporary and is caused by false expectations amongst the public that the lari would be devalued in autumn.
As of today $1 costs 2,61 GEL and €1 is equivalent to 3,03GEL.
There were high expectations in people that the lari would lose its price in the autumn despite the fact there were no grounds for that. The expectations made an influence on the national currency in the short-term perspective only”, the bank wrote, referring to expectations when people try to buy foreign currencies as they are afraid of the devaluation of a national currency.
The bank stressed that mid-term and long factors having an influence on the national currency were positive and the tendency would continue in the next year.
Based on September data, incomes from solid export and tourism has risen about 30 percent and remittances have increased by 20 percent,” the bank wrote.
The NBG said they were in active communication with the government of Georgia and in the case of any threat of inflation they are ready to use all levers to avoid high inflation.
The National Bank of Georgia (NBG) has sold millions of dollars at the Foreign Exchange Auction to control the changing value of the national currency against the US dollar.
"We expect the [Georgian] national currency to stop devaluing [against the US dollar] in the near future,” says the National Bank of Georgia (NBG).
The Government of Georgia is promising to take steps to stabilise the national currency and even support the Georgian Lari (GEL) to regain value following a sharp decline since mid-August.
Georgia's Prime Minister Giorgi Kvirikashvili says his Government has taken steps to help the national currency regain value over the coming months as economic planners worked to restore the balance between the country's import and export values.
"The current devaluation of the national currency is temporary, however if it lasts for a long time and if it threatens inflation, we will react to it and tighten the monetary policy,” says Vice President of the National Bank of Georgia Archil Mestvirishvili.
Georgia’s Economy Minister Dimitry Kumsishvili says that as of April 2018 the use of the US dollar in Georgia’s economy has "reduced significantly”.
The Georgian national currency, the lari, has depreciated in value by 6.5 tetri against the US dollar and by 4.3 tetri against the Euro in just one day.
Georgian banks and financial organizations will have to issue loans up to 200,000 GEL only in the national currency.
The Georgian national currency, the lari, continues to depreciate in value against the US dollar as well as the euro. The National Bank of Georgia (NBG) explains that the presidential election period is the reason behind the depreciation.
The National Bank of Georgia (NBG) has purchased 10 million dollars at foreign exchange auction to control the national currency’s changing value against the US dollar.
The National Bank of Georgia (NBG) has purchased $15 million at foreign exchange auction to control the national currency’s changing value against the US dollar.