Azerbaijani banks sharply reduce cash sale of foreign currency
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The volume of net US dollars sold by Azerbaijani banks to the population has decreased by 55 times and stood at $79 million, read a report of the Central Bank of Azerbaijan (CBA) on the monetary policy as of the first quarter of 2016.
Cash transactions in euros have drooped by 3.5 times and stood at 69 million euros.
In total, 82 percent of transactions on Azerbaijan's currency market in January-March 2016, were carried out in US dollars.
The report said that the remaining 18 percent of the operations accounted for other currencies.
The volume of transactions in dollars and euros has dropped by 2.8 times and 2.7 times, respectively in January-March 2016, as compared to the same period in 2015.
In general, the volume of Azerbaijan's currency market has sharply decreased in January-March 2016, as compared to the same period in 2015.
"The decrease in the volume of currency market during the reporting period is related to the demand and supply factors," said the CBA report. "One of the main factors affecting the decrease in demand for foreign currency is the decline in the import of goods and services."
Moreover, the slowdown in the dollarization process in the first quarter of 2016 also affected the decline in demand for foreign currency, added the Central Bank.
The report said that the decrease of supply on the currency market is primarily related to the reduction of currency sales by the State Oil Fund of Azerbaijan (SOFAZ).
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