The National Bank of Georgia continues to sell foreign currency to maintain the exchange rate of the GEL. Today, October 23, the bank sold an additional 60 million US dollars. As a result, the lari strengthened by 1.05 against the dollar and by 2.41 against the euro. The official value of one dollar is now 2.7157 GEL, while the euro is worth 2.9273 GEL.
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The National Bank explains that the decision to hold the foreign exchange auction was made "to prevent the excessive influence of non-fundamental factors and the agitation traditionally characteristic of the pre-election period in the currency market."
"This, in turn, will avoid negative impacts on prices and financial stability and will contribute to the stabilization of the foreign exchange market," the statement reads.
Only in October, the National Bank has implemented three interventions and sold 173 million US dollars from its reserves. According to Giorgi Kepuladze, the founder of Society and Banks, the National Bank may have sold such an amount through the Bmatch platform. This information will be announced at the end of November.
"The main effect is that the government will somehow maintain the already devalued exchange rate before the elections. The market has perceived a certain risk and is therefore trying to accumulate currency resources to insure against potential future risks. The expectation is that if the government records false results and falsifies the elections, this could lead to sanctions and further currency devaluation. Under different management, I am confident the National Bank would not have intervened so openly in the currency market before the elections. However, today's management lacks independence and primarily follows the political agenda of the Georgian Dream," Giorgi Kepuladze evaluates the decision of the National Bank.
Recently, the publication Global Finance rated Natia Turnava, the acting president of the National Bank of Georgia, with the lowest score among the managers of European central banks.
