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Azerbaijan’s manat plunged to the weakest on record after the central bank relinquished control of its exchange rate, the latest crude producer to abandon a currency peg as oil prices slumped to the lowest in 11 years.

The third-biggest oil producer in the former Soviet Union moved to a free float on Monday to buttress the country’s foreign-exchange reserves and improve competitiveness amid “intensifying external economic shocks,” the central bank said in a statement. The manat, which has fallen in only one of the past 12 years, nosedived 32 percent to 1.5375 to the dollar as of 2:30 p.m. in the capital, Baku, according to data compiled by Bloomberg.

The Caspian Sea country joins a host of developing nations from Vietnam to Nigeria that have weakened their currencies this year after China devalued the yuan, commodities prices sank and the Federal Reserve prepared to raise interest rates. Azerbaijan burned through more than half of its central bank reserves to defend the manat after it was allowed to weaken about 25 percent in February as the aftershocks of the economic crisis in Russia rippled through former Kremlin satellites.

“The only real surprise is that they waited so long, blew scarce FX reserves in the process, and thereby undermined the sovereign balance sheet and credibility and confidence in the process,” Timothy Ash, head of emerging-market strategy at Nomura International Plc. in London, said by e-mail.

Currency, Bonds

Azerbaijan relies on hydrocarbons for more than 90 percent of its exports and the manat has lost almost half its value against the dollar this year, the worst performance of currencies globally. The Azeri central bank’s reserves were at $6.2 billion at the end of November, down from more than $15 billion a year earlier.

The Russian ruble’s collapse and a 70 percent plunge in the crude price since June last year have ushered in a new era of volatility for Azerbaijan, which is also beset by challenges ranging from declining oil output to a festering conflict with neighboring Armenia.

The $75 billion economy will grow 1.7 percent next year, down from an estimated 2.8 percent in 2015, Moody’s Investors Service said in a Dec. 4 report. The rating company, which has Azerbaijan at Baa3, its lowest investment grade, predicted the nation’s budget deficit at 9.2 percent of gross domestic product this year and said its debt-to-GDP ratio will “spike” in 2015 from about 11 percent in 2014.

While Azerbaijan’s former Soviet allies Russia and Kazakhstan have moved to floating currency regimes in the past year, the Azeri central bank has questioned whether the country was prepared for a similar shift. Governor Elman Rustamov said there was no need for another devaluation of the manat, according to a televised interview broadcast on Sept. 25.

The currency turmoil has prompted an exodus by savers from accounts in the manat, putting more pressure on banks and the foreign-exchange market. In Azerbaijan, the share of foreign-currency deposits reached more than 70 percent in the months after the February devaluation, from 51 percent at end-January, according to Fitch Ratings.

Even so, the first devaluation this year has helped the country adapt by easing the strain of lower oil prices on budget revenue and making the country’s exports more competitive, Moody’s said. After the central bank’s move on Monday, government 2024 dollar bonds jumped the most in almost two months, reducing the yield 20 basis points to 5.98 percent.

“It looks like Azerbaijan’s authorities are following Kazakhstan’s devaluation path,” said Oleg Kouzmin, a former Russian central bank adviser who works as an economist at Renaissance Capital in Moscow. “After devaluing the currency once, some time ago, they concluded that the first move was not enough to tackle all the challenges of a weaker oil price environment.”

( Updates with background in third paragraph. )