Georgian currency, lari (GEL), firmed 1.68% against the U.S. dollar on Tuesday after the central bank sold USD 26.96 million.
The National Bank of Georgia (NBG) intervened with its offer to sell USD 40 million, but only USD 26.96 million was sold, NBG said.
GEL strengthened to 2.4086 per U.S. dollar from previous 2.4499, according to central bank’s official exchange rate set for Wednesday.
GEL is 37.7% weaker from September, 2014.
On September 21, when GEL approached its all-time low, PM Irakli Garibashvili and his economic team met central bank chief Giorgi Kadagidze, who said that the NBG would intervene on the foreign exchange market “if necessary.”
The September 22 intervention was NBG’s first one since April and the sixth one this year.
The central bank sold total of USD 200 million in five previous interventions earlier this year.
Georgian central bank’s foreign currency reserves stood at USD 2.26 billion as of end-August.
The September 21 meeting between government’s economic team and the central bank chief also came after Minister for Regional Development and Infrastructure, Nodar Javakhishvili, who was Georgia’s central bank chief in 1993-98, said in a newspaper interview published on September 21, that the Georgian economy “will not withstand” if lari hits 2.54 mark per dollar.
Such a scenario, he told the weekly Kviris Palitra, is fraught with the risk of public uproar in the country where up to 64% of total loans are denominated in foreign currency, mostly in U.S. dollar.