16:09, 4 May, 2021
YEREVAN, MAY 4, ARMENPRESS. The Central Bank is forecasting external and internal inflation effects on the Armenian economy but the 12-months inflation – after a certain acceleration in the short-term sector- will gradually decrease and stabilize around a targeted 4%, the Armenian Central Bank’s governor Martin Galstyan said at a news conference.
Galstyan noted that the Board of the Central Bank of Armenia decided to raise the refinancing rate by 0.5 percentage point to 6.0%.
“A 1,0% inflation was recorded in March 2021 against the 0,5% of the same month of the previous year, with the 12-months inflation increasing and amounting 5,8%. The 12-months normal inflation accelerated in the same volume, amounting 6,6% in the end of March,” he said.
Galstyan said that in the first quarter of 2021 faster-than-projected trends of recovery of the economy and demand are recorded in Armenia’s main partner countries associated with the promoting policies and certain positive results of the use of COVID-19 vaccines. High inflation developments are seen in international markets of raw materials and food products affected by positive expectations of global demand’s recovery and several demand factors, which is manifested also with the development of high inflation environment in partner countries.
“In such conditions the Central Bank Board continues to expect inflation effects from the external sector on the Armenian economy. The 2021 Q1 economic activity developments outline more positive trends for the economy than projected before,” Galstyan said, adding that gross demand will be restored with faster pace than expected due to increase in global demand and increase of money transfers from abroad.
At the same time, according to the central bank’s assessments uncertainties and somewhat inflation expectations have increased among the public, and as a result certain inflation effects are manifested from the domestic economy as well.
Galstyan said the board of the cenbank finds the risks of the inflation deviating from the projection to be balanced and that it is ready to respond accordingly to ensure stability of prices.
Editing and Translating by Stepan Kocharyan
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