Tag Archives: interest rates

Kyrgyzstan rates stay steady

APRIL 27 2015 (The Conway Bulletin) – Kyrgyzstan’s Central Bank held interest rates steady at 11% because of slowing inflation, media reported. Previously the Central Bank has aggressively raised interest rates to try and curb inflation generated by the falling value of the som.

ENDS

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(News report from Issue No. 229, published on April 29 2015)

 

Georgia CBank keeps interest rates steady

MARCH 26 2015 (The Conway Bulletin) –  Georgia’s Central Bank kept its key interest rate at 4.5%, confounding expectations of another rate rise to counter a fall in the value of its lari currency. The Central Bank said the current inflation rate did not merit a rate rise although it also said that a gradual devaluation would probably push prices up.
ENDS

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(News report from Issue No. 225, published on April 12015)

Kyrgyz CBank leaves rates unchanged

FEB. 24 2015 (The Conway Bulletin) — Kyrgyzstan’s Central Bank left its key interest rate unchanged at 11% despite inflationary pressure from a devaluing currency and falling remittances from workers based in Russia. In February, Kyrgyzstan’s inflation was measured at 10.9%.
ENDS
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(News report from Issue No. 220, published on Feb. 25 2015)

Georgia Central Bank increases rates

FEB. 11 2015 (The Conway Bulletin) — As expected, Georgia’s Central Bank increased its key interest rate by 50 basis points to 4.5% to try and dampen inflation. The Georgian lari has lost 8.5% of its value against the US dollar this year, increasing inflationary pressures.
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(News report from Issue No. 219, published on Feb. 18 2015)

Kyrgyz Central Bank spends heavily

FEB. 17 2015 (The Conway Bulletin) — Kyrgyzstan has spent around 10% of its currency reserves this year defending its currency from devaluing, media quoted the chairman of the Central Bank, Tolkunbek Abdygulov, as saying. The Kyrgyz som is closely linked to the Russian rouble and has devalued against the US dollar by around 20%.
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(News report from Issue No. 219, published on Feb. 18 2015)

Armenia raises interest rates, again

>>Inflation and Russian rouble devaluation are pressuring Armenian Central Bank>>

FEB. 10 2015 (The Conway Bulletin) — Armenia’s Central Bank increased its key interest rate to 10.5% from 9.5%, the third rate rise since December, because of rising inflation.

Data from the Central Bank showed that annualised inflation hit 4.3% in January which is at the top end of the government’s target range.

Central Banks across Central Asia and the South Caucasus have steadily been increasing interest rates to keep pace with Russian monetary moves. Russia is trying to defend its currency against both falling oil prices and the impact of sanctions.

Armenia’s economy is particularly tied into Russia’s economy. At the beginning of the year, Armenia also joined the Kremlin-lead Eurasian Economic Union which many see as a Moscow inspired political union.

Inflation in Russia has hit around 12% and is still rising. Economists said this would undoubtedly push the price of goods in Armenia up too.

Before the Central Bank raised interest rates in December, the Armenia’s interest rate had stood at 6.75%.
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(News report from Issue No. 218, published on Feb. 11 2015)

Georgia cuts growth rate

>>Russian woes continue to weigh on South Caucasus region>>

FEB. 6 2015 (The Conway Bulletin) — Georgia became the latest country in the South Caucasus/Central Asia region to downgrade its economic forecast for this year.

Finance minister Nodar Khaduri said growth would measure 4% in 2015, down from an earlier prediction of 5%.
Like its neighbours, the slowdown in Russia’s economy is also impacting on Georgia.

“Economic growth in Armenia and Moldova this year was zero percent. A drop is expected in economic growth in Ukraine and Russia due to well-known reasons,” media quoted him as saying.

Georgia’s economy is slightly better sheltered from the economic storm swirling around Russia. The depressed state of the Russian economy has hit Armenia hard and the fall in the price of oil has dented Azerbaijan’s economy.

Georgia, though, is not reliant on either the Russian economy nor on oil prices. That said, both still filter through and impact Georgia.

The Georgian Central Bank has already said it will likely raise interest rates later this month to try and combat the falling value of its lari currency.

“Considering the challenges in the economy today and analysing the numbers and data it is necessary that we start to revise the 5% growth prognosis and plan macroeconomic and fiscal indicators from the beginning so they adequately reflect the economic policy, and respond to these challenges,”” Mr Khaduri said.
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(News report from Issue No. 218, published on Feb. 11 2015)

Ratings agencies downgrade Armenia

>>Armenia’s economy is closely linked to Russia’s fortunes>>

JAN. 30 2015 (The Conway Bulletin) — Ratings agencies Fitch and Moody’s downgraded Armenia’s bond ratings to negative from stable, another sign that the Armenian economy is in for a turbulent few months.

Fitch said that it expected Armenia’s economy to slip into a recession this year and the deficit to widen.

“Remittances amount to about 15% of GDP and fell by about 30% during the last months of 2014 as 90% of the total come from Russia,” it said in a research note.

Armenia has been hit by the drop in the Russian rouble and the turmoil in Russia’s economy, triggered by a fall in oil prices and sanctions imposed by the West after the Kremlin’s intervention in Ukraine.

Over the past seven months, Armenia’s dram currency has fallen by nearly 20% against the US dollar despite a steady increase in interest rates.

Of course, it’s not just Armenia which is exposed to the drop in Russia’s economy and currency. The rest of Central Asia and the South Caucasus have also been badly hit.

Armenia, though, is particularly closely linked. It is desperately hoping that there will be some improvement in Russia’s economy.
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(News report from Issue No. 217, published on Feb. 4 2015)

Georgia to tighten monetary policy

JAN. 30 2015 (The Conway Bulletin) — Georgia’s Central Bank chief, Georgy Kadagidze, said he would tighten monetary policy next week after another drop in the value of its lari currency. Mr Kadagidze has said that he would not spend the bank’s reserves heavily to prop up the lari which has lost around 15% of its value since November.
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(News report from Issue No. 217, published on Feb. 4 2015)

Georgian lari hits 10-year lows

>>Pressure building on the C.Bank as lari hits 10-year lows>>

JAN. 27 2015 (The Conway Bulletin) — Georgia’s economic policymakers have said that they will not intervene to halt the fall in the value of the lari currency.

Pressure has been building on the Central Bank as the lari has lost 7% of its value against the US dollar this year, adding to a 12% loss at the end of 2014.

But economy minister, Giorgi Kadagidze, said that the Central Bank would not start spending its reserves to prop up the currency.

The lari is now trading at over 2 to the US dollar. This is the cheapest that the lari has been for over a decade.

The big worry for Georgian economic decision makers is that inflation will start creeping up.

At its last meeting on interest rates in December, the Central Bank elected to keep the key rate unchanged. The Central Bank chief, Giorgi Kadagidze, said that if there was any hint of inflationary pressure appearing he would raise interest rates.

Georgia had been less affected by the turmoil in Russia’s economy and the drop in oil prices over the past six months. Clearly the poor economic data is beginning to catch up with it.
ENDS

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(News report from Issue No. 216, published on Jan. 28 2015)