APRIL 28 2015 (The Conway Bulletin) – Georgia’s lari currency dropped to a 16-year low against the US dollar despite efforts by the Central Bank to prevent the fall.
The Central Bank said it had sold off another $40m of its reserves to prop up the lari. This was the fifth intervention of $40m this year by the Central Bank despite an earlier pledge by its head, Georgy Kadagidze, not to sell its reserves to defend its value.
Even so, the lari fell to 2.3 against the US dollar its lowest level since 1999. Since November, the lari has lost around a third of its value.
A fall in the price of oil and a drop in the value of the Russian rouble have hit the economies of Central Asia and the South Caucasus hard.
Georgia has reported a 27% drop in exports in the first quarter of 2015 compared to a year earlier and has cut its projected GDP growth to 2% from an earlier estimate of 5%. Remittances from Russia have fallen by around 20%.
ENDS
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(News report from Issue No. 229, published on April 29 2015)
