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Central Bank of Azerbaijanâ€™s foreign exchange reserves dwindle

20 May 2009 14:31 (UTC +04:00)

Baku. Vahab Rzayev â€“ APA-Economics. As of May 1, the Central Bank of Azerbaijanâ€™s official foreign exchange reserves stood at US$4 906.6 million, up 14% or $600 million from a year ago.

However, foreign exchange reserves diminished by 20% or $1 230.4 million during January-April, said the Central Bank of Azerbaijan.

The decrease during four months running accompanies the rapid accumulation of currency reserves over the recent years.
There are several factors which could probably erode assets.

The central bank loosened monetary policy and increased market intervention by pouring foreign currencies into the market.

Against the backdrop of currency devaluation in neighbouring Russia, Kazakhstan, Armenia, Ukraine and other countries amid the global financial crisis, Azerbaijan poured money to keep up the home currency.

The decrease in foreign exchange reserves has been common for many central banks across the world.