Monday, September 27 2021 14:19
Naira Badalian

Central Bank of Armenia expects inflation to return to target  threshold

Central Bank of Armenia expects inflation to return to target  threshold

ArmInfo. Despite the fact that annual inflation in Armenia reached 8.8% in August 2021, and the growth continues, the Central Bank expects inflation to return to the  target value of 4%. This was stated by the Deputy Chairman of the  Central Bank of the Republic of Armenia Nerses Yeritsyan on September  27 at a meeting of the Standing Committee on Financial-Credit and  Budgetary Issues on the Execution of the State Budget for the first  half of 2021.

"After eliminating the base effect and taking into account the  monetary policy pursued since December 2020, inflation will return to  the target framework at 4%," the document reads.  According to him,  the work carried out in this direction by the Financial Regulator  over the past 7-8 months should already give the expected result.

Earlier, ArmInfo reported that on September 14, at a meeting of the  Council of the Central Bank of Armenia, the refinancing rate was once  again increased - from 7% to 7.25%. In this regard, rates on lombard  repo and on deposits attracted from banks were also increased by  0.25% percentage points - to 8.75% and 5.75%, respectively.  To note,  in 2021 this is the fifth increase in the refinancing rate. For the  first time, the Central Bank raised the refinancing rate on February  2 - from 5.25% up to 5.5%. Accordingly, by 0.25 percentage points  were raised rates on lombard repo - from 6.75% to 7%, and on  attracted deposits from banks to deposits - from 3.75% to 4%. The  second increase in the refinancing rate followed on May 4 - by 0.5  percentage points to 6%, in accordance with which the rates on  lombard repo were also increased - to 7.5%, and on deposits attracted  from banks - to 4.5%. The third increase in the refinancing rate  followed on June 15 - up to 6.5%, in accordance with which the rates  on lombard repo were also increased - up to 8%, and on deposits  attracted from banks - up to 5%. And the fourth increase in the  refinancing rate took place on August 3 - by 0.5 percentage points to  7%, in accordance with which the rates on lombard repo were also  increased - to 8.5%, and on deposits attracted from banks - to 5.5% .   Prior to that, in 2020, the Central Bank revised the refinancing rate  four times downward and once upward. In particular, after the  reduction of the refinancing rate from 5.5% to 4.25% (March, April,  June, September), an increase to 5.25% took place in December. And  the corresponding change was undergone by the rates on lombard repo  and on deposits attracted from banks - up to December 6.75% and  3.75%.

Meanwhile, according to statistics, in August of this year official  annual inflation in the consumer market of Armenia reached 8.8% (data  of the RA Statistical Committee), while real inflation increased to  8% (data of the Central Bank of Armenia), against 1.8% and 1.1% per  annum, respectively, in the same month of 2020. So, in August 2021 to  August 2020, consumer prices increased by 8.8% (against an increase  of 1.8% a year earlier) due to an increase in the price of food  products by 14.5% and non-food products by 9.4%, with an increase in  tariffs for services by 1.8%. In August 2020 alone, inflation was  recorded at 0.4% (against 0.1% deflation in August 2020) due to the  rise in prices for food products by 0.5% and non-food products by  0.4%, while tariffs for services increased by 0.1%. In Yerevan,  consumer prices increased by 0.4% in August 2021, against a decline  of 0.1% a year earlier.

The increase in consumer prices by 0.4% was accompanied by a 0.2%  devaluation of the dram against the dollar, and in January-August  against the background of inflation of 3.7%, there was a revaluation  of the dram against the dollar by 5.2% (against deflation of 1.2% and  devaluation of the dram by 1.5% a year earlier). The estimated  exchange rate of the dram to the dollar in August 2021 averaged 491.7  AMD / USD 1, exceeding the level of a year ago by 1.3% (485.5 AMD /  USD 1).  Economic growth in the state budget for 2021 is foreseen at  3.2%, while inflation is set at 4% (+/- 1.5%). 


News
Make payments via Idram in online stores, get free delivery or a cashback and take part in the drawMake payments via Idram in online stores, get free delivery or a cashback and take part in the draw
Interest rates on loans and deposits have grownInterest rates on loans and deposits have grown
In Moscow, Suren Papikyan discussed issues related to In Moscow, Suren Papikyan discussed issues related to "North-South  Power Corridor" and construction of a new nuclear power unit in  Armenia 
Armenian Minister of Economy received Deputy Minister of Industry and  Trade of Czech RepublicArmenian Minister of Economy received Deputy Minister of Industry and  Trade of Czech Republic
Issue of feasibility of creating institution of business ombudsman is  being discussed at RA Economy Ministry Issue of feasibility of creating institution of business ombudsman is  being discussed at RA Economy Ministry 
Armenia is ready to cooperate in developing common approach to  protect EAEU internal market in case of pressure from third partiesArmenia is ready to cooperate in developing common approach to  protect EAEU internal market in case of pressure from third parties
Armenian government approves draft decision on increasing ANIF  authorized capitalArmenian government approves draft decision on increasing ANIF  authorized capital
Pashinyan: Formation of the common energy market of the EAEU is a  prerequisite for the full realization of the potential of economic  integrationPashinyan: Formation of the common energy market of the EAEU is a  prerequisite for the full realization of the potential of economic  integration
Official supplier of furniture for shops of number of world brands  and a pharmaceutical company received tax incentive from RA  Government Official supplier of furniture for shops of number of world brands  and a pharmaceutical company received tax incentive from RA  Government 
Water users will be reimbursed for rent for irrigation water for a  period of 5 years in the event of the introduction of drip irrigation  systems on an area of up to 3 hectaresWater users will be reimbursed for rent for irrigation water for a  period of 5 years in the event of the introduction of drip irrigation  systems on an area of up to 3 hectares
RA Minister of Economy did not rule out that Standard & Poor`s would assign credit rating to RA Minister of Economy did not rule out that Standard & Poor`s would assign credit rating to "Export Insurance Agency of Armenia" CJSC
S&P Improved the Outlook on Ameriabank to Positive S&P Improved the Outlook on Ameriabank to Positive 
S&P improves forecast for 2021 on Real GDP Growth in Armenia to 6.3%S&P improves forecast for 2021 on Real GDP Growth in Armenia to 6.3%
Expert: Building a 600 MW reactor would be the most appropriate  option for ArmeniaExpert: Building a 600 MW reactor would be the most appropriate  option for Armenia
Expert: It is reasonable to use stock exchanges for the formation of  market-based gas prices Expert: It is reasonable to use stock exchanges for the formation of  market-based gas prices 
Head of Ministry of Territorial Administration got acquainted with  work of  Agarak Copper-Molybdenum CombineHead of Ministry of Territorial Administration got acquainted with  work of  Agarak Copper-Molybdenum Combine
IMF stands ready to assist Government of Armenia in implementing its  ambitious reform agendaIMF stands ready to assist Government of Armenia in implementing its  ambitious reform agenda
Standard & Poor`s assigns sovereign rating to Armenia for the first  timeStandard & Poor`s assigns sovereign rating to Armenia for the first  time
Global Finance Names Ameriabank the Safest Bank in ArmeniaGlobal Finance Names Ameriabank the Safest Bank in Armenia
Revenue of the trade sector of Armenia for 8 months of 2021 exceeded  $ 4 billionRevenue of the trade sector of Armenia for 8 months of 2021 exceeded  $ 4 billion
Armenia will allocate more for military spending in 2022 than in  2021, but less than for servicing and paying off government debtArmenia will allocate more for military spending in 2022 than in  2021, but less than for servicing and paying off government debt
Armenia and Poland intend to intensify cooperation between startups  of two countriesArmenia and Poland intend to intensify cooperation between startups  of two countries
Global Finance names AraratBank the Best Sub-Custodian Bank in ArmeniaGlobal Finance names AraratBank the Best Sub-Custodian Bank in Armenia
Armenian government delegation to take part in Russian Energy WeekArmenian government delegation to take part in Russian Energy Week
Armenia participates in Europe`s largest trade fair for food within  EU4Business initiativeArmenia participates in Europe`s largest trade fair for food within  EU4Business initiative
Ambassador: Sweden welcomes the readiness of the Armenian government  to carry out systemic reformsAmbassador: Sweden welcomes the readiness of the Armenian government  to carry out systemic reforms
Gnel Sanosyan and Kishan Dan Dewal discussed the North-South  investment program and the possibilities of the Iranian port of  ChabaharGnel Sanosyan and Kishan Dan Dewal discussed the North-South  investment program and the possibilities of the Iranian port of  Chabahar
EIB stands ready to support the efforts of the Armenian government to  improve the business environmentEIB stands ready to support the efforts of the Armenian government to  improve the business environment
Minister of Economy took part in opening of PanArmenian Expo 2021  12th International Exhibition- ForumMinister of Economy took part in opening of PanArmenian Expo 2021  12th International Exhibition- Forum
Ambassador: Economic cooperation between Armenia and Slovenia does  not correspond to the existing potentialAmbassador: Economic cooperation between Armenia and Slovenia does  not correspond to the existing potential
Draft state budget: In 2022, Armenia will increase its national debt  by another $ 1.053 billion - to about $ 10.2 billionDraft state budget: In 2022, Armenia will increase its national debt  by another $ 1.053 billion - to about $ 10.2 billion
ANIF starts cooperation with Italian Intesa Sanpaolo group ANIF starts cooperation with Italian Intesa Sanpaolo group 
Tigran Khachatryan and Carolin Geginat discussed prospects of  cooperation between  RA Government and World BankTigran Khachatryan and Carolin Geginat discussed prospects of  cooperation between  RA Government and World Bank
Production of brandy became leader in terms of volume in Armenia`s  alcoholic industry, and whiskey production is leader in terms of  growth ratesProduction of brandy became leader in terms of volume in Armenia`s  alcoholic industry, and whiskey production is leader in terms of  growth rates
Freight and passenger transportation reaches double-digit growth  in ArmeniaFreight and passenger transportation reaches double-digit growth  in Armenia
Telecommunications revenue in Armenia increased by 4.8% in 8 months  of 2021Telecommunications revenue in Armenia increased by 4.8% in 8 months  of 2021
Head of Central Bank of Armenia met with President of Council of  Ministers of ItalyHead of Central Bank of Armenia met with President of Council of  Ministers of Italy
Central Bank of Armenia: Net inflow of transfers from individuals for  8 months of 2021 exceeded the pre- covid volume 2-foldCentral Bank of Armenia: Net inflow of transfers from individuals for  8 months of 2021 exceeded the pre- covid volume 2-fold
Armenian government prepares to issue Diaspora bondsArmenian government prepares to issue Diaspora bonds
Armenia`s metallurgical industry reaches double-digit growthArmenia`s metallurgical industry reaches double-digit growth
Pashinyan: The state will participate in all the promising investment  programs of GeoProMining in ArmeniaPashinyan: The state will participate in all the promising investment  programs of GeoProMining in Armenia
Armenia`s foreign trade with EU countries reaches double-digit growthArmenia`s foreign trade with EU countries reaches double-digit growth
Armenia`s foreign trade with EAEU countries intensifies at a rapid  paceArmenia`s foreign trade with EAEU countries intensifies at a rapid  pace
Armenia reduced production of aluminum foil by 3.9% in 8 monthsArmenia reduced production of aluminum foil by 3.9% in 8 months
Aram Sargsyan: The key to Armenia`s development is universal  diversificationAram Sargsyan: The key to Armenia`s development is universal  diversification
World Bank`s forecast on GDP growth in Armenia for 2021 turned out to  be more optimistic than the forecast of the Central Bank of Armenia -  6.1% versus 5.4%World Bank`s forecast on GDP growth in Armenia for 2021 turned out to  be more optimistic than the forecast of the Central Bank of Armenia -  6.1% versus 5.4%
In Armenia, y-o-y inflation in September 2021 reached 8.9% due to  increase in food pricesIn Armenia, y-o-y inflation in September 2021 reached 8.9% due to  increase in food prices
Ruling faction advocates gradual abolition of income tax refund  system on mortgage loans in YerevanRuling faction advocates gradual abolition of income tax refund  system on mortgage loans in Yerevan
Armenia and Russia discussed issues of Armenian-Russian economic  cooperationArmenia and Russia discussed issues of Armenian-Russian economic  cooperation
ACBA Bank: publicity and a new development paradigmACBA Bank: publicity and a new development paradigm
Production of solar energy has increased significantly in ArmeniaProduction of solar energy has increased significantly in Armenia
Total investment in the construction of a copper smelter, the second  open pit at ZCMC, an enrichment plant and a new nuclear power plant  of average capacity in Armenia is estimated at $ 3-3.5 billionTotal investment in the construction of a copper smelter, the second  open pit at ZCMC, an enrichment plant and a new nuclear power plant  of average capacity in Armenia is estimated at $ 3-3.5 billion
Growth of Armenia`s foreign trade turnover in 8 months of this year  significantly exceeded pre-COVID ratesGrowth of Armenia`s foreign trade turnover in 8 months of this year  significantly exceeded pre-COVID rates
Armenia will receive official grants of approximately USD 81.6  million in 2022Armenia will receive official grants of approximately USD 81.6  million in 2022
Iran is in TOP-3 of Armenia`s foreign trade partners after Russia and  ChinaIran is in TOP-3 of Armenia`s foreign trade partners after Russia and  China
Industrial growth is hampered by the decline of the dominant sector,  the manufacturing industryIndustrial growth is hampered by the decline of the dominant sector,  the manufacturing industry
In Armenia, growth of economic activity for 8 months by 4.9% of this  year is still inferior to pre-COVID 7% In Armenia, growth of economic activity for 8 months by 4.9% of this  year is still inferior to pre-COVID 7% 
Delegation of RA Economy Ministry will discuss possibilities of  expanding cooperation with Delegation of RA Economy Ministry will discuss possibilities of  expanding cooperation with "ALROSA" mining company in Moscow
Iran intends to take part in completion of the ``Tatu`` transit road  in ArmeniaIran intends to take part in completion of the ``Tatu`` transit road  in Armenia
Draft state budget: Current expenditures in 2022 will grow by almost  207 billion drams, 122.8 billion drams more will be allocated for the  social sector: Draft state budget: Current expenditures in 2022 will grow by almost  207 billion drams, 122.8 billion drams more will be allocated for the  social sector: 
Read more


Exchange rates
15.10.2021
RUB6.720.03
USD478.42-0.34
EUR555.06-0.83
GBP656.77-0.18
CAD387.540.79
JPY41.83-0.42
CNY74.30-0.03
CHF518.16-2.12