Devaluation: Is it a threat to manat in 2024?
By Sabina Alizade
After the increase in public transportation fares and the rise in gasoline and diesel fuel prices in Azerbaijan, there have been reports of a possible devaluation of the national currency. The question of whether the manat faces devaluation this year is causing concern among the public and experts.
Economic expert Vugar Bayramly , in an interview with News.Az, noted that the manat's exchange rate is influenced by the amount of foreign currency entering the country and the state of the balance of payments. According to him, "there are no threats to the manat at the moment."
"This is due to the large amount of incoming currency and the maintenance of a positive balance of payments. Given that Azerbaijan has not transitioned to a floating exchange rate system, the manat's rate directly depends on the decisions of the Central Bank, which retains the ability to intervene. Thus, the Central Bank has sufficient resources to stabilize the currency rate and prevent devaluation," he said.
Financial and banking expert, economist Akram Hasanov , in an interview with News.Az, emphasized that there is currently no threat of devaluation.
"On the contrary, the price increase indicates possible inflation, but not devaluation. The country has sufficient foreign exchange reserves, and with rising prices, the state will not allocate additional funds. This underscores the resilience of the country's financial system and its ability to cope with temporary economic challenges without significantly affecting the manat's exchange rate," the expert said.
Economic expert Natig Jafarli also stated in an interview with News.Az that devaluation is unlikely this year.
"While the country's trade balance is stable, this does not mean that there will be no devaluation in the future. A decision on devaluation may be made in 2025 or closer to its end. His analysis points to the need for continued monitoring of economic conditions to respond timely to potential threats to the national currency's stability," the economist stated.
There are no grounds for rumors of an impending devaluation of the manat in Azerbaijan. The country's economic indicators, especially the positive trade balance and stable oil prices, indicate the strength of the national currency. Given the administrative management of the foreign exchange market and the presence of government programs supporting economic stability, the likelihood of devaluation remains extremely low. Therefore, the panic among the population and investors should be replaced with a rational approach and trust in the actions of the Central Bank and the government.
In general, despite economic changes and rising prices for key goods and services, experts agree that the manat is not threatened with devaluation this year. The main factors supporting currency stability include significant foreign exchange reserves, a positive balance of payments, and effective management by the Central Bank. Thus, the public and investors are advised to remain calm and trust the country's economic policy.
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