“The central bank’s all steps are aimed at stabilizing the lari”

“The central bank’s all steps are aimed at stabilizing the lari”

access_time2019-10-03 10:00:28

"The National Bank’s actions are part of a strategy to boost the lari’s strengthening," President  of the Association of Banks of Georgia Alexander Dzneladze says.

 

According to Dzneladze, the regulator’s decision to reduce the reserve requirement by 5%, from 30 to 25%, was timely and was among the central bank’s other measures such as an  increase in the refinancing rate and the currency interventions.

“These decisions can  raise the value of the national currency. All three steps are aimed at stabilizing the lari, and providing banks with  more foreign currency that could be used for lending, ” President of the Association of Banks notes.


 At the same time, he believes that we should not expect that currency interventions without other decisions, will be able to stabilize the lari.

 

“Intervention can trigger  only a short-term, momentary effect and cannot cause a long-term appreciation of the currency. To ease the pressure on the lari, other actions, including  the National Bank’s other steps,  are also needed,” Alexander Dzneladze says.

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