Inflation eats up Pashinyan’s “increased” pensions

The economic reality of Armenia once again breaks the propaganda image of “economic success” built by the government over the years.

While Nikol Pashinyan’s government continues to talk about economic activity, “unprecedented growth”, increased pensions, the ordinary citizen faces a completely different reality in his daily life: constant price increases, decreasing purchasing power and social uncertainty. The latest data published by the RA Statistical Committee prove that in 2026 in March, the 12-month inflation was already out of the acceptable range for the second month in a row (2-4%). 3.3% inflation in January already became 4.2% in February, and in March it increased even more, reaching 4.5%.

If in February, some people tried to present the situation as a temporary phenomenon, now it is obvious that quite worrying and dangerous trends are forming within the economy. Against the backdrop of government announcements about high economic activity, demand-driven price pressures are actually maintained, and in the conditions of regional tension, supply-related risks are also deepening. In other words, the talk about “sustainability” can be considered as a fairy tale that an attempt is made to impose on the public.

The most worrying thing is that according to the Council of the Central Bank of RA in 2026 The official report of the May 5 session: 12-month normal inflation has already reached 4.7%of This means that even the seasonal price reduction of fruits and vegetables cannot control the general inflation. In other words, price increases have become profound and widespread. It seems that the RA citizen should spend less in these months, taking into account that the heating season is over, and utility bills logically decrease relatively, but the fact of inflation, along with non-increasing incomes, simply empties citizens’ wallets.

Such a situation is an indicator of the failure of economic policy, because every, even small, fluctuation in the region has a serious consequence on the economy of Armenia. this is the result of an economic policy that is exclusively dependent on external factors. By the way, the Central Bank Council in 2026 in the session of May 5, it did not change the refinancing rate of 6.5%, which has remained unchanged for about 5 months, until 2025. from December 16. It turns out that the government is trying to gain time during the pre-election period, avoiding tough but necessary decisions.

It is obvious that the current government, in all probability, already felt that in the case of such dynamics of inflation, it will be difficult to control the wave of social dissatisfaction rising among the public. That is why it was suddenly decided to increase the minimum pension by 10,000 drams before the elections. Moreover, that decision was so hasty and populist that even some officials of the ruling team learned about it at the last moment. What is this, if not a classic pre-election bribery?

This decision is miles away from being a long-term social policy solution. And even after this step, Pashinyan’s government could not fulfill its programmatic promise to equalize the average amount of the pension to the value of the consumer basket. Instead, the government began to artificially “fill” the missing money, pretending that the money returned from non-cash transactions through the cashback mechanism (repayment of pension and benefits) supposedly solves the problem. However, the government forgets to mention the most important thing: thousands of pensioners do not use cashback at all, they do not have the skills and knowledge to actively use bank cards, and in the case of rural settlements, making purchases with cashless transactions is simply limited.

The current situation is dangerous not only in the economic sense, but also in the political sense. On the one hand, the incomes of the citizens are not sufficient to withstand the increase in prices, on the other hand, the government continues to engage in short-term propaganda measures, trying to maintain the minimum level of social tolerance until the elections. The most dangerous thing is that the current inflation indicators still do not fully reflect the impact of those “pre-election gifts”. This means that in the coming months the citizen of Armenia may face a harsh reality․ the new inflation will simply “swallow” the noisy increases in pensions, and the government’s promises will again remain only on paper.

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