Foreign Exchange Reserves Fall Sharply as NBG Sells Record Amount of Dollars in October
In October 2024, Georgia’s foreign exchange reserves decreased by a record USD 627 million according to the latest information released by the Bank. The four foreign exchange interventions made immediately before the parliamentary elections mark a significant decline in the country’s foreign exchange reserve, which fell from USD 4.71 billion to USD 4.08 billion. This is the largest one-month decline in the history of the NBG.
The main reason for this decrease was the four foreign exchange interventions carried out by the NBG in the pre-election period, including the sale of 213 million dollars, and the implementation of additional interventions allegedly through the Bmatch platform. The detailed statistics on the volume of reserves sold this way [through the Bmatch platform], will be available on November 25.
“In August 2023, the country’s foreign exchange reserves stood at 5.44 billion dollars. However, as has been observed, this figure has since decreased to 4.08 billion dollars. This represents a decline of 1.36 billion dollars in the period spanning a bit more than a year, placing the reserves significantly below the critical threshold. Compared to the volume of foreign payments, no country with a BB rating has reserves of this volume. The issue of revising this rating will soon be on the agenda,”- stated Roman Gotsiridze, the former president of the National Bank of Georgia, on Facebook.
In an interview on November 8, Arvind Ramakrishnan, the head of the analytical team at Fitch Ratings, addressed the current decision of the National Bank of Georgia. He highlighted that as of the end of September, the level of reserves covers only 2.6 months of current account payments. This is below the minimum level of three months recommended by the International Monetary Fund.
Also read:
- 18/10/2023- NBG Sells Additional Foreign Reserves
- 13/06/2024- NBG Sells More US Dollars in One Month than in 2023
This post is also available in: ქართული (Georgian) Русский (Russian)