Decline in Armenia`s consumer prices was caused by food products;  while prices for services and gasoline were on rise

ArmInfo. In Armenia, consumer prices are falling due to cheaper food products, such as cereals,  flour, meat, butter, fish, bread, cheeses, vegetables and fruits. In parallel, an increase in prices for gasoline, alcohol and cigarettes is recorded. In addition, the prices of services continue to increase, especially the tariffs for personal transport services have risen sharply, by the data of the RA Statistical Committee.

In particular, in 2024, the February y-o-y deflation of 1.7% was  provoked by a decrease in the price of food products by 5.9% (with an  increase in the price of alcoholic beverages by 7.1% and cigarettes  by 8.3%), an increase in the price of non-food products by 0.7% and  an increase in tariffs for services by 3%. As a comparison, in Feb  2023, y-o-y inflation was recorded at 8.1%, which was caused by an  increase in prices for food products by 9.7%, non-food products by  5.4%, and services by 7.4%.

In Jan-Feb 2024, consumer prices increased by 0.4% due to a rise in  prices for food products by 0.8% and an increase in tariffs for  services by 0.7%, while prices for non-food products fell by 0.8%.   Compared to Jan-Feb 2023, consumer prices decreased by 1.3% which is  due to a 5.2% decrease in the price of food products, along with  which there was an increase in prices for non-food products by 0.7%  and an increase in tariffs for services by 3.2%. A year earlier, in  Jan-Feb 2023, an inflation of 1.5% was due to a rise in prices for  food products by 3.3% and an increase in tariffs for services by  0.7%, with a decrease in prices for non-food products by 1.3%, and  compared to Jan- Feb 2022, inflation of 8.1% was caused by an  increase in prices for food and non-food products by 9.6% and 5.8%,  respectively, with a 7.3% increase in tariffs for services.

Among food products, the most significant y-o-y decline (Feb  2024-Feb2023) was recorded for sunflower oil - by 27.7%, margarine -  by 25%, buckwheat - by 24%, flour - by 17.4%, peas - by 14, 8%,  lentils- by 12.9%, pasta - by 11.6%. The price of trout decreased  slightly less pronouncedly - by 8.1%, bread - by 7.8%, cheeses - by  7.6%, whole grain wheat (dzavar) - by 7.6%, butter - by 7.3 %, pork -  by 6.9%, chocolate - by 6%, sugar and granulated sugar - by 5.6%,  beans and rice - by 3.8-3.2%, cocoa - 3%, as well as flour and tea -  by 1.9-1.6%, beef, chicken and lamb - by 1.7-1.3%. Vegetables and  fruits on y-o-y terms fell in price by 19.3% and 4.5%, respectively.  But there are also food products that have risen in price year-  on-year: eggs - by 3.2% and milk - by 2.4%.

Among non-food products, the price of gasoline has risen sharply on  y-o-y terms (Feb 2024 to Feb 2023), - by 45.8%, while diesel fuel  increased in price by 4.3% alone, with a decline in their prices by  6.2% and 3.8%, respectively in Jan-Feb. In addition, on y-o-y terms,  the price of jewelry increased by 7.1%, large and small household  electrical appliances - by 3.5-4.6%, furniture - by 3.9%, shoes - by  3.9%, dishes and kitchen utensils - by 2.3%, hand tools and  accessories - by 0.9%, clothing - by 0.1%. Gardening equipment fell  in price by 5%, disposable household goods by 1.9% and building  materials by 1.1% on y-o-y terms.  Among the services, personal  transport services has significantly increased in price on y-o-y  terms - 3.1- fold. Further ahead in terms of tariff growth are  services in the areas of comprehensive services for organizing  recreation - by 22.7%, organizing sports and entertainment events -  by 11.5%, transport - by 10.6%, in the segment of repair of furniture  and household items - by 5.1%, repair of household appliances - by  5%, in the segment of home repair and maintenance - by 2.3%. Services  in the hotel business also increased in price - by 3.7%, hairdressing  and spa salons - by 3.3%, and medical services increased in price by  3.1%. Dry cleaning and clothing repair services, as well as clothing  rental salons, increased in price by 3% over the year, and shoe  repair prices increased slightly - by 4.5%. Financial services rose  in price by 9.7% over the year. According to statistical data, a  decrease in tariffs in the service sector on y-o-y therms, was  recorded only for motor insurance - by 10%, which is most likely  explained by the liberalization of tariffs for CMPTL from April 2023.

February's 0.7% deflation in the consumer market was accompanied by a  0.2% revaluation of the dram against the dollar. (versus 0.1%  inflation and 0.6% revaluation of the dram against the dollar in Feb  2023).  In Jan-Feb 2024, inflation of 0.4% in the consumer market was  accompanied by a 0.1% revaluation of the dram against the dollar  (against 1.5% inflation and a 0.3% revaluation the dram against the  dollar in Jan- Feb 2023). In Feb 2024, the dram depreciated against  the dollar by 2.8% per annum (against revaluation by 18.1% a year  earlier) - to 404.3 AMD/$1 (from 393.4 AMD/$1 in Feb 2023), while on  two-year terms revaluing by 15.8% (from 480.2 AMD/$1 in Febr 2022).