Tuesday, July 17 2012 17:43
Central Bank of Armenia expects private spending growth rates to accelerate by 4.6% in 2012
ArmInfo. The Central Bank of Armenia (CBA) expects the private spending growth rates to accelerate and the investment growth to decelerate in 2012. The CBA's monetary and credit policy program for Q2 2012 says that the private spending growth will make up 4.6% against the previously forecasted 3.5%. The revision of this forecast was due to the growth in private spending and private investments. In the meantime, the real decline of state expenses will be 0.6%. Under this scenario, the aggregate domestic demand in the economy will grow by 3.9%.
The source says that the forecast of the private spending growth rates has been revised due to faster growth rates of domestic economy than expected and low inflationary environment. This forecasts is also based on the mid-term adjustment of the private spending growth estimated by the CBA at 4.3% for 2012.
The private investment growth rates are expected to decelerate due to lower growth rates of construction than expected, despite the fact that the growth rates of economic activity and lending are expected to accelerate. In particular, the expected growth of private investments will be 5.4% against the previously forecasted 6.4%.
According to the CBA, the higher level of the expected economic growth, maintenance of the money flow growth rates and economy crediting growth rates in 2012 will condition the reduction of the unfavorable balance of the private spending to 0.9% and further zeroing by the end of the year. This will form a weak inflationary pressure in economy by 0.2-0.4%.
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