Tuesday, August 1 2023 13:01

ArmInfo. The Board of the Central Bank of Armenia (CBA) decided to reduce the refinancing rate by 0.25% - from 10.5% down to 10.25%, after two successive years of raising it  up to the historical maximum of 10.75% in late in 2022, which rate  remained unchanged until June 13, 2023. 

The Lombard repo facility rate has been reduced from 12% down to  11.75%. 

The Deposit facility rate has been reduced from 9% down to 8.75%.

This June against last June, 0.5% deflation was recorded. Last June  10.3% inflation was recorded against June 2021. CBA-calculated annual  core inflation in June 2023 went down to 1.5% (as against 9.4% last  June). 

The CBA raised the refinancing rate to 10.75% on December 13, 2022,  which proved a record after the 10.5% of 2015. The CBA raised the  refinancing rate last year: in February, from 7.75% to 8%, in March,  up to 9.25%, in August, up to 9.5%, in September, up 10.5%, in  November, from 10% to 10.5%. From 2021 to December 13, 2022, the CBA  raised the refinancing rate 12 times - from 5.25% up to 10.75%. in  previous years, the historical maximum of the refinancing rate was  recorded on February 10, 2015 - from 9.5% up to 10.5%. 

According to the CBA forecast revised late last December, inflation  was to go down to 3.9% this year (against the actual 8.3% in 2022),  to remain within 4% in 2024 and 2025. On the other hand, the CBA has  revised its GDP forecast downward - to 4.6% as against the actual  12.6%in 2022, with a deceleration down to 4.2% in 2025. 

In 2021, the CBA raised the refinancing rate six times: in February  (by 0.25 percentage point, up to 5.5%), in May (by 0.5 percentage  point, up to 6%), in June (by 0.5 percentage point, up to 6.5%), in  August (by 0.5 percentage point, up to 7%), in September (by 0.25  percentage point, up to 7.25%), and in December (by 0.5 percentage  point, up to 7.75%). During the same periods, the Lombard repo  facility rates were raised from 6.75% up to 9.25% in December, with  the Deposit facility rates raised from 3.75% up to 6.25%. 

In 2020, the CBA revised the refinancing rate downward four times,  and upward one time. Specifically, after reducing the refinancing  rate from 5.5% down to 4.25% (March, April, June, September), the CBA  raised it up to 5.25% in December. The Lombard repo and Deposit  facility rates were changed to 6.75% and 3.75% in December 2020.