The energy-rich former Soviet republic of Turkmenistan Thursday devalued its currency against the US dollar by 18%, as AFP notes, in the latest sign of contagion among Russia’s neighbors from the plunging ruble(following Krgyzstan’s 17% plunge in 2014 and Kazakhstan’s 14% tumble). However, as Martin Armstrong warns, this is symptomatic of a deflationary contagion that “will contribute to now force the dollar higher… We are in a major economic collapse on a global scale. Most people do not understand that this is the real threat we face.”
The devaluation came as the plunge in value of the Russian ruble, linked to Western sanctions over Ukraine and falling oil prices, sent shockwaves through former Soviet republics.
All Turkmenistan’s currency exchange offices and banks were closed Thursday, officially due to the public holiday.
The official exchange rate set by the central bank for the manat had been set at 2.85 to the US dollar since 2009. Earlier in 2009, Turkmenistan had knocked zeroes off the manat in a redenomination after the official exchange rate reached 14,250 to the dollar.
Turkmenistan has been led by President Gurbanguly Berdymukhamedov since 2006, following the death of the eccentric dictator Saparmurat Niyazov, who erected a golden statue of himself that revolved to face the sun.