Monday, June 23 2014 19:18
Central Bank of Armenia retains the 12-month inflation forecast for 2014 at 2.5- 5.5%
ArmInfo. In its monetary policy programme for Q2 2014, the Central Bank of Armenia (CBA) has retained the previous inflation forecast for 2014. According to the programme, the 12-month inflation in Armenia will make up 2.5-5.5% in 2014. The inflation will be dropping more intensively than expected and in Q3 2014 it will reach the lower level of the target range.
The source says that inflation will drop mostly due to liquidation of the effects of last July's rise in energy tariffs. In the meantime, the sustainable easing of the monetary terms, as well as the expanding fiscal policy will boost the aggregate demand and restore the inflation rates. As a result, in the near future the economic growth will intensify to some extent, and this will contribute to stabilization of the inflation within the mid-term outlook.
In the CB's monetary policy, the risks that inflation will deviate from the target level are equal for short- and mid-term periods. The external risks come from the economic prospects of developing countries (especially Russia) and their influence on the global raw materials and food markets.
The present uncertainty in Armenia's economy comes mostly from slowly recovering private capital investments and problems in agriculture. If such risks recur, the Central Bank will undertake measures to zero inflation in mid-term future.
According to the National Statistical Service of Armenia, in 2013 inflation made up 5.6% against 5.8% in 2012. In 2013 food prices rose by 4%, nonfood prices by 3.5%, service tariffs by 9.7% against 5.8%, 4,6% and 6.4% rises in 2012.
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