According to Levan Vepkhvadze, Executive Director of the Georgian Business Association, the reason for GEL rate strengthening is refinancing rate growth up to 9% by the National Bank. Moreover, strengthening of GEL is also caused due the taken loans in GEL by the citizens and businesses, who have converted the sum into USD.
According to Levan Vepkhvadze, the main factor for strengthening the national currency is the restriction of access to GEL.
“The main reason of GEL strengthening is that access to the GEL has been slowly restricted. Refinancing rate increase have got GEL loans expensive and I think that some of our citizens or businesses have refinanced the loans in GEL. The availability of dollar has increased and you know that the National Bank has reduced the reserve requirement from 30% to 25% on foreign currency lending, so if these steps continue, I mean - easing regulations, - I think lari will continue strengthening further and may reach 2.7 point. However, most importantly, these decisions should be implemented in a timely manner, " Vepkhvadze said
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