The governor of the Bank of Latvia, Ilmars Rimsevics, took a heroic stand on CNBC Wednesday morning, rubbishing all talk of potential devaluation and accusing anyone of having suggested as much of being hugely misguided on the subject of Latvia, probably not even knowing the capital of the country is Riga.
Some choice quotes:
People who try to allege something like that are not familiar with the arrangement here.
I think many people were listening to the media. Many people at that time didn’t even know the capital of Latvia.
Here’s the interview link, so do have a look if you want to hear an exceptionally rosy account of the state of Latvia’s finances.
CNBC itself writes it up like this:
Latvia will continue to intervene to defend its fixed-rate currency as it has sufficient foreign exchange reserves to do so, Bank of Latvia governor Ilmars Rimsevics told CNBC in an exclusive interview Wednesday. The Baltic country, which was hard hit by the global economic downturn, has no plans to devalue the lat and will not ask for more funds from the International Monetary Fund, Rimsevics added. “We are in the (IMF) program and we don’t have to go anywhere and we don’t have to go and ask for more,” he told “Worldwide Exchange.” “There will be new money disbursed as more reviews are in place,” Rimsevics added.
Related links:
A quick turn of events in Latvia – FT Alphaville
Latvian banks face reserve shortfall – FT Alphaville
Trouble at Parex – FT Alphaville