Dollarization level of individuals’ deposits declined - central bank

In the first quarter of 2017 the monetary base in manat declined 7.4% to AZN 7,211.5 million, said the Central Bank’s Monetary Policy Review for January-March 2017.

According to the document, the cash money supply and manat correspondent account, which are components of decline in monetary base, slid 4.3% and 32.8% in the reporting period.

“Manat monetary base declined due to increase of money multiplier, which expresses banking system’s ability to create money. During the reporting period, manat money multiplier increased 2.7% to 1.51. Money supply (M2 board) slid 4.9% to AZN 10,981.9 million. Cash money supply descended 3.6%, individuals’ manat deposits – 2.4%, legal entities’ manat deposits – 7.6%. M3 board declined 4.7% to AZN 19,902.9 million. No significant change occurred in deposit dollarization. Share of savings and deposits in foreign currency in M3 board made up 44.7% in early 2017, 44.8% at the end of the first quarter”, the document said.

Share of foreign currency savings and deposits in total savings and deposits made up 64.8% in the reporting period, while it was 64.4% in early 2017.

Individuals’ manat deposits slipped 2.4%, foreign currency deposits – 8.4%. Dollarization level of individuals’ deposits decreased from 79.6% to 78.6%.apa