Country Report Algeria April 2011

Outlook for 2011-15: Exchange rates

The BdA will continue to operate a managed float of the Algerian dinar, the aim of which is to maintain exchange-rate stability, particularly with the dollar and the euro. The dinar will gain ground on the single currency, appreciating from an average of AD100.02:EUR1 in 2011 to AD90.53:EUR1 in 2015, as the euro zone continues to suffer from monetary and fiscal imbalances. The BdA may intervene to weaken the currency to limit imports of European goods and favour local producers. The dinar will weaken slightly against the dollar in 2011, averaging AD76.50:US$1 before appreciating to AD71.81:US$1 in 2012. The central bank retains sufficient foreign reserves to be able to maintain or lower the value of the dinar as it deems necessary.

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