ArmInfo. The Central Bank of Armenia and this time left the refinancing rate unchanged - at the level of 9.25%. As the press service of the Central Bank of Armenia told ArmInfo, this decision was made on June 14 at a meeting of the Board of the Central Bank of Armenia.
The message of the Central Bank of Armenia also notes that, in accordance with this, Lombard facility rate and Deposit facility rate were kept at the same level, 10.75% and 7.75%, respectively.
Head of the Central Bank Martin Galstyan will present a detailed rationale for this decision of the Central Bank Board today at 3:30pm at a press conference. The refinancing rate has been raised eight times since 2021 - from 5.25% to 9.25%. The refinancing rate has been raised two times in 2022: in February - from 7.75% to 8% and in March - to 9.25%, still remaining at this level. And the refinancing rate has been raised eight times since 2021 - from 5.25% to 9.25%. According to statistics, in May 2022, official y-o-y inflation in the consumer market of Armenia reached 9%, against respectively inflationary annual 5.9% in May 2021. The main y-o-y inflation calculated by the Central Bank in May 2022 was 8.4%, compared to 7.4% y-o-y inflation in May 2021, respectively.cIt would be appropriate to recall that the forecast of the Central Bank, updated at the end of March, foreshadowed a decrease in inflation to 6.6% for 2022 from the actual 7.7% in 2021, with the target of 4% approaching in 2024.
However, the Central Bank's forecasts will most likely change in the upcoming updates in June 2022, as new challenges will be reflected against the backdrop of the Russian-Ukrainian military-political conflict and comprehensive, unprecedented, large-scale US and European sanctions against Russia, the share of which dominates in the main macroeconomic indicators of Armenia.
Yesterday, Chairman of the Central Bank of the Republic of Armenia, Martin Galstyan, during a meeting of the parliamentary commission, stated that the inflationary environment in Armenia would continue. Referring to the FAO Index, he noted that there is no encouraging news, since the issue is more military- political than economic. In this context, the head of the Central Bank wondered whether Russia would allow Ukrainian grain to be supplied to international markets in order to avoid starvation in a number of countries or not, how would the problem with sunflower oil, corn oil, etc. be solved? "Questions of this kind lead to the idea that the inflationary environment will continue," he said. Predicting the future situation, the Chairman of the Central Bank noted that according to forecasts, the inflation rate of 9% in Armenia may show certain growth trends within several months. "But if nothing extraordinary happens, then at the end of the year inflation will be below today's level," he said.
It should be noted that the refinancing rate was raised by 1.25% up to 9.25% on March 15, 2022, with the lombard repo facility rate raised from 9.5% up to 10.75% and deposit facility rate raised from 6.5% up to 7.75%. Earlier, on February 1, the refinancing rate was raised by 0.25% up to 8%, with the with the lombard repo facility rate raised from 9.25% up to 9.5% and deposit facility rate raised from 6.25% up to 6.5%. Last year, the refinancing rate was last raised on December 14, 2021, - from 7.25% up to 7.75%. Last year, the CBA raised the refinancing rate six times: in February (by 0.25% up to 5.5%), in May (by 0.5% up to 6%), in June (by 0.5% up to 6.5%), in August (by 0.5% up to 7%), in September (by 0.25% up to 7.25%) and in December (by 0.5% up to 7.75%), with the lombard repo facility rate raised from the initial 6.75% up to 9.25% last December, and deposit facility rate raised from the initial 3.75% up to 6.25%.
In 2020, the CBA revised the refinancing rate down four times and up one time. Specifically, after revising the refinancing rate from 5.5% down to 4.25% (March, April, June, September), the CBA revised it up to 5.25%, with the lombard repo facility rate and deposit facility rate at 6.75% and 3.75% respectively in December.
