Monday, January 24 2011 16:48
ARFD parliamentarian: Central Bank of Armenia should not ensure stability of the financial market and restrain inflation at the same time
ArmInfo. The Central Bank of Armenia is not accountable for its macroeconomic forecasts, Artsvik Minasyan, parliamentarian from ARF Dashnaktsutyun Party, Vice Chairman of the Parliament Commission for Finance and Budget, told media on Monday. "The Central Bank is not responsible for forecast failures, including inflation forecast. In this case external inflation pressures have become substantiations in addition to the negative influence of agricultural prices in 2010," he said. To recall, the inflation target for 2010 was 4+/-1.5%, whereas inflation for 11 months of 2010 versus the same period of 2009 was 8.1%.
ARFD's evaluation (drafted in Dec 2009) of the social and economic policy of the government and the budget for 2011 says that revaluation of the national dram and high prices, including for imported goods, was partially caused by the desire of importers to gain profits in foreign exchange and national currency. This shows that high concentration of Armenian economy. "The tough monetary policy aimed to reduce inflation leads to high interests rates impeding business expansion because of expensive credit funds. The low profitability of the operating industrial and agricultural enterprises aggravates the situation," he said.
A. Minasyan believes that to adequately reflect the purchasing power of the population, it is necessary to study not only the 12-month inflations (which is targeted by the Central Bank at present) but also the average inflation and deviation from it must become a serious alarm for interference of the Central Bank.
A. Minasyan said that the CB has not only limited accountability, but also a too large circle of regulation with contradictory functions of financial market stability provision and inflation restraining.
