Exchange Rate Appreciation in Armenia: Inevitable Trap or an Outcome of Bad Policies? Part II

In Part I of this article, we recalled some basic economic theory related to the exchange rates and reviewed some of the downsides of real exchange rate appreciation. Also, following question 1, we concluded that the net effect of exchange rate appreciation on the economy today and growth prospects in the future are likely to be negative, and largely so, for an economy like Armenia's.