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Expert talks reasons for introduction of new banknote in Azerbaijan

25 May 2018 11:00 (UTC+04:00)
Expert talks reasons for introduction of new banknote in Azerbaijan

By Trend

Issuance of a new bill of 200 manats will not lead to an increase in inflation expectations, expert economist Farhad Amirbayov believes.

"The issuance of a new bill will not lead to a surge in inflation and especially to a possible devaluation in the near future," Amirbayov told Trend May 24.

He noted that this step, on the contrary, will strengthen the competitiveness of the manat and reduce the level of dollarization.

"In fact, this step is one of the tools to reduce the level of dollarization in cash circulation. Before the devaluation, 100 manats were equal to 100 euros and about $120, which allowed this large bill to compete successfully with foreign banknotes in those segments of the economy where there is a large cash turnover. After the devaluation, this advantage was lost. The new banknote will allow using the manat as a means of payment again. In turn, this will allow to withdraw from cash circulation a part of the US dollars," Amirbayov said.

A closed presentation of a new banknote with face value of 200 manats was held in Baku in the building of the Central Bank of Azerbaijan May 23. The date of the new banknote's entry into circulation and the volume of the primary issue are not yet known.

Currently, the banknotes in denominations of 1, 5, 10, 20, 50 and 100 manats are used in Azerbaijan.

(1.7 AZN = 1 USD on May 24)

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