CBA’s currency intervention amounted to over $500m in Q1

By: Aynur Jafarova

The volume of currency interventions conducted by the Central Bank of Azerbaijan (CBA) amounted to $536 million in the first quarter of 2014.

This was announced by CBA Deputy Chairman Khagani Abdullayev last week.

“This is a normal level. It is important to consider that we enjoyed sufficient surplus of account of current transactions – about $12 billion- last year, and we expect that it will remain at the approximately same level by the end of this year as the volume of export is large enough,” Abdullayev told journalists.

He noted the bid in the currency market continues to outpace the demand.

“According to our forecasts, the volume of currency intervention by the end of 2014 will amount to about $1.5-2 billion,” Abdullayev stressed.

The total amount of the currency reserves of CBA exceeded $14.7 billion in the first quarter of 2014. This figure was $12.33 billion in the first quarter of 2013.

The currency reserves of CBA increased by 21 percent and amounted to $14.152 billion in 2013. CBA plans to increase the volume of its reserves to $16 billion by late 2014.

Rapid growth of the currency reserves was the main factor for the formation of a strong macroeconomic buffer and reduction of sensitivity of the domestic economy towards external shocks. The increase in reserves led to the maintenance of the continued net investment position of the country at an acceptable level.