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Market stabilizing amid wait-and-see attitude - Tatul Manaseryan
12:32 * 25.01.15
In an interview with Tert.am, Founder of the Alternative research
center, Doctor of Economy, Prof. Tatul Manaseryan commented on certain
transactions postponed because of exchange fluctuations.
According to him, experienced economic entities must be able to
continue and make calculations amid exchange fluctuations.
As regards commercial banks, which are reducing consumer lending, he
said the uncertain situation is a key factor.
"Our market is under numerous influences, and I would not say the
aforementioned factors are the only ones accounting for the business
community's wait-and-see approach. I can say that exchange
fluctuations have always taken place, and we should be ready for any
scenario. In any situation, both importers and producers can benefit
from favorable conditions. I do not see any reasons for panic. Those
showing a wait-and-see approach are not experienced businessmen.
Experienced businessmen are well aware of what they should do amid
fluctuations."
According to Mr Manaseryan, consumers' situation is not so favorable.
A declining demand is number one obstacle. In contrast to the
situation in other countries, he does not see salary adjustment in
Armenia. The government is only trying to raise the minimum wages and
pensions.
Secondly, Armenia's banking system should try self-insurance, and
commercial banks are one of the mechanisms. And the current problems
are the result of this uncertain situation.
"Specifically, what is going to happen to the exchange rate and who is
to pay for that? It will affect the consumer market as well. Aggregate
demand is declining, with resulting decline in the purchasing power.
With consumer lending reduced, the market will encounter problems," Mr
Manaseryan said.
As to how long such situations may last, he said:
"If we see the exchange rates, they do not show wide margins. Serious
exchange fluctuations last November and December were accompanied by
wide margins. At present, they are 1, 2 or 3 drams. This means that
the market is stabilizing."
The Central Bank of Armenia (CBA) has raised the financing rate to
prevent AMD depreciation, which is causing a rise in loan interest
rates. Side effects should be expected as well, he added.
Armenia is trying to stabilize its national currency.
"USD and Euro exchange fluctuations are most important. Overvalued
dollar is an impediment to the US economic development as well. The
European Union is taking steps to stabilize its currency as well," Mr
Manaseryan said.
The exchange fluctuations will influence Armenia's small economy. If
the country focuses on its own production and on meeting domestic
demand, it will be more independent of shocks on foreign markets and
control prices.
http://www.tert.am/en/news/2015/01/25/Tatul-manaseryan/1568945
12:32 * 25.01.15
In an interview with Tert.am, Founder of the Alternative research
center, Doctor of Economy, Prof. Tatul Manaseryan commented on certain
transactions postponed because of exchange fluctuations.
According to him, experienced economic entities must be able to
continue and make calculations amid exchange fluctuations.
As regards commercial banks, which are reducing consumer lending, he
said the uncertain situation is a key factor.
"Our market is under numerous influences, and I would not say the
aforementioned factors are the only ones accounting for the business
community's wait-and-see approach. I can say that exchange
fluctuations have always taken place, and we should be ready for any
scenario. In any situation, both importers and producers can benefit
from favorable conditions. I do not see any reasons for panic. Those
showing a wait-and-see approach are not experienced businessmen.
Experienced businessmen are well aware of what they should do amid
fluctuations."
According to Mr Manaseryan, consumers' situation is not so favorable.
A declining demand is number one obstacle. In contrast to the
situation in other countries, he does not see salary adjustment in
Armenia. The government is only trying to raise the minimum wages and
pensions.
Secondly, Armenia's banking system should try self-insurance, and
commercial banks are one of the mechanisms. And the current problems
are the result of this uncertain situation.
"Specifically, what is going to happen to the exchange rate and who is
to pay for that? It will affect the consumer market as well. Aggregate
demand is declining, with resulting decline in the purchasing power.
With consumer lending reduced, the market will encounter problems," Mr
Manaseryan said.
As to how long such situations may last, he said:
"If we see the exchange rates, they do not show wide margins. Serious
exchange fluctuations last November and December were accompanied by
wide margins. At present, they are 1, 2 or 3 drams. This means that
the market is stabilizing."
The Central Bank of Armenia (CBA) has raised the financing rate to
prevent AMD depreciation, which is causing a rise in loan interest
rates. Side effects should be expected as well, he added.
Armenia is trying to stabilize its national currency.
"USD and Euro exchange fluctuations are most important. Overvalued
dollar is an impediment to the US economic development as well. The
European Union is taking steps to stabilize its currency as well," Mr
Manaseryan said.
The exchange fluctuations will influence Armenia's small economy. If
the country focuses on its own production and on meeting domestic
demand, it will be more independent of shocks on foreign markets and
control prices.
http://www.tert.am/en/news/2015/01/25/Tatul-manaseryan/1568945