AMD Weakness Over 2012

The relatively illiquid nature of the Armenian Dram should see it broadly spared from the capital flight from emerging and frontier market assets, as growing disarray in the eurozone fuels investor risk aversion. That said, we do not expect it to be entirely immune, and would expect to see investment flows into the country suffer accordingly, creating depreciatory pressure on the unit. Accordingly, we believe we could see the Dram head back to AMD390/US$ over the short term, and rate the probability of a strong appreciatory trend developing over the coming months as low.

To read the full article, please choose one of the following options: