Azerbaijan devalues currency by almost 50 percent

BAKU - Anadolu Agency

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The Azerbaijani Central Bank devalued its currency by almost 50 percent on Dec. 21 due to global economic weakness and falling oil prices, according to a statement issued by the bank.

The Central Bank decided to devalue the manat by 47.63 percent to 1.55 manats per dollar and 1.68 manats per euro, which corresponds to a devaluation of 47.88 percent, said the statement.

The Central Bank also adopted a floating exchange rate.

“The decision of the Central Bank of Dec. 21, 2015, is to move to a floating exchange rate for the manat. On the basis of this decision, the rate of the manat will be determined depending on supply and demand in the foreign exchange market,” said the statement.

Oil and gas account for 95 percent of Azerbaijan’s exports and 70 percent of government revenue.

The sharp decline in the price of oil has been putting pressure on reserves at the Central Bank bank as it sought to enforce the manat’s peg to the dollar, Central Bank Gov. Elman Rustamov said in an interview with the Financial Times in February.