Monday, March 14 2011 11:07
Expected decrease of inflation in second half of 2011 to restore purchasing power in Armenia
ArmInfo. Armenia's monetary policy may soon be toughened through raising interest rates, Artur Stepanyan, Head of the Monetary Department, Central Bank of Armenia (CBA), told journalists March 12. Lower-rate price rise is expected from the 2nd half of 2011, he said. He also added that such measures as well as some anti-crisis measures of the government and other structures have been creating today the real pre-conditions for the inflation decrease to the target - 4% (+/-1,5%)
He recalled that inflation in Armenia in February 2011 as against February 2010 was 12,4% and raising of prices for food and raw material production still remains its main factor. He also added that in Armenia prices for fruit and vegetable will remain at the same level in the first half of the current year before harvest 2011, but will start reducing sharply in the second half.
Asked by ArmInfo correspondent if the policy of high prices may have a restraining effect upon the economic activity, Stepanyan replied that one the one hand limiting the demand of citizens for consumer credits the policy conducted by the Central Bank allows local businessmen to preserve their expenses at the same level when making foreign currency investments in technologies. He drew journalists' attention to the fact that today foreign currency, dollar, rates of interest are at a rather normal level and will hardly grow.
As for reduction of purchasing power of citizens, Stepanyan said that at present growth of benefits of citizens does not compensate the inflation level in the country. "It means there is a certain decrease of the purchasing power", he said. Nevertheless Stepanyan is sure that the expected decrease of inflation in the second half of the year against the background of measures being held by the government and Central Bank will restore the former level of the purchasing power.
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