The US dollar's decline to its lowest level against major currencies in nearly four years has created a new topic of discussion in global economic markets. Against the backdrop of this process, US President Donald Trump's statements regarding Greenland, and tensions with Cuba and Venezuela, have created additional uncertainty in world markets, causing investors to shy away from risk. Stock exchanges, wary of instability, traditionally seek safe haven in gold and silver during crises. To reduce their dependence on the dollar, most Central Banks around the world began purchasing precious metals, which stimulated recent price increases for gold and silver.
In such a global landscape, the potential effects of the dollar's weakening on the Azerbaijani economy, particularly on the stability of the manat, also come to the fore.
In a statement to Modern.az, Vugar Bayramov, a member of the Milli Majlis Committee on Economic Policy, Industry, and Entrepreneurship, noted that the depreciation of the US dollar in the world market is directly linked to the increase in global geopolitical tensions.
“This process naturally has a direct impact on the dollar's exchange rate. At the same time, investors are more cautious about investing in risky assets. In particular, the increases observed in the gold market clearly demonstrate this. Over the past year, investors' shift towards gold has intensified. As a result, the price of one gram of gold has risen to 170 dollars, which represents an increase of approximately 84 percent in the last year. This trend affects the position of the US dollar relative to other currencies, including reserve currencies”.
The deputy added that, against the backdrop of the dollar's declining exchange rate, the manat is not expected to strengthen against the dollar:
“Because at the current stage, an appreciation of the manat's exchange rate against the dollar or other currencies is not considered a priority. The Central Bank's position also indicates that the main goal is to maintain the current exchange rate level. From this perspective, the manat's exchange rate in 2026 will also directly depend on the Central Bank's policy. Since Azerbaijan has not transitioned to a floating exchange rate regime, the Central Bank's decisions play a decisive role in the formation of the manat's exchange rate, and this factor will remain key in 2026,” V. Bayramov stated.
