Wednesday, April 18 2012 22:14
Central Bank of Armenia forecasts deceleration in growth rates of expenditures in private sector for 2012
ArmInfo. The Central Bank of Armenia forecasts reduction in the growth rates of expenditures in the private sector for 2012 and slight acceleration in investment growth.
The program of the CBA's monetary policy for Q1 2012 says that the growth of private spending will be 3.5% due to the increase in private consumption and private investments. In the meantime, the government expenditure will grow by 0.7%. In case of the specified scenario, the domestic demand will increase by 3% versus the same period of 2011.
Though the growth rates of economic activity and lending are expected to decline, the growth rates of private investments are expected to slightly accelerate. In particular, the expected growth of private investments will be 6.4% due to the fact that the reduction in private investments in 2011 was bigger than expected.
The source says that the growth rates of consumption in the private sector are expected to decelerate due to the expected deceleration in the growth rates of economic activity and money transfers from abroad.
According to the CBA, the expected deceleration in money inflows and growth rates of economy lending for 2012 will increase the unfavorable balance of private spending by 1-1.5% (private spending was at the zero level in Q4 2011). However, by late 2012 the gap between the supply and the demand in the private sector will disappear.
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