High exchange rates can cause higher unemployment (video)
In recent months, fluctuations in the currency exchange rate have been so frequent that people do not even manage to follow the rate. The dollar continues though slowly, but very steadily while the dram is depreciating day by day.
“Russia’s role is great in the dollar-dram fluctuations. The country’s’ economy is declining and the Russian ruble is devaluing abruptly because of EU's sanctions against Russia over Ukraine crisis,” says economist Hayk Mnatsakanyan.
The flow of transfers to Armenia has also dropped recently, whereas the volume of transfers to foreign countries has increased by 5 percent to total 74 million drams. Economist Aram Arakelyan is surprised that the dram is depreciating so abruptly. “It would be better to start the depreciation in August after a thorough study of the future trends,” he says.
That the capital is not used in Armenia and is sent abroad can result in higher unemployment and increase the inflation rates, affecting people’s income at the same time.
