IMF: Inflation in Armenia expected to rise to 3.9% in 2025, nearing  the target rate

ArmInfo. According to the new forecast from the International Monetary Fund (IMF), inflation in  Armenia is projected to be 1% in 2024 compared to the deflationary rate of 0.6%, and then increase to 3.9% in 2025, coming closer to the target of 4%.

This is noted in the IMF report "World Economic  Outlook. Policy Pivot,  Rising Threats". The IMF has maintained its  GDP growth forecast for Armenia in 2024 at 6% (compared to 8.3%  growth in 2023), but has revised its expectations for 2025, now  predicting a more significant slowdown to 4.9% compared to the  previously predicted 5.3% slowdown. 

According to the IMF forecast for Armenia, the ratio of the current  account deficit to GDP is projected to increase to 4.2% in 2024 (up  from 2.3% in 2023), with a slight further increase to 4.8% in 2025.   This IMF report also provides a forecast for 2024-2025 of the above  indicators for Armenia's neighboring countries and its partners in  the EAEU. The inflation forecast is as follows: in Georgia, an  increase is expected from 1.3% to 3% (from 0.4% in 2023); in  Azerbaijan there will also be an increase from 4.6% to 5% (from 2.1%  in 2023); in Iran, on the contrary, a decrease from 30% to 28% (from  32.2% in 2023); in Turkey there will also be a decrease from 43% to  24% (from 64.8% in 2023); in Russia the level will initially remain  at 7.4% (as in 2023), then decrease to 4.8%; in Belarus, after an  increase to 6.4% (from 5.8% in 2023), there will be a slight decrease  to 6.3%; in Kazakhstan, a decrease is expected from 8% to 6.6% (from  9.8% in 2023); and in Kyrgyzstan, after a decrease to 5% (from 7.3%  in 2023), there will be no changes. 

In terms of GDP growth in the fore-mentioned countries, the IMF  forecast for 2024-2025 predicts a slowdown. In Georgia, there is  expected to be an imperceptible acceleration of growth to 7.6% (from  7.5% in 2023) at first, followed by a slowdown to 6%. In Azerbaijan,  growth is forecasted to accelerate to 3.2% (from 1.1% in 2023),  followed by a slowdown to 2.5%. In Iran, growth will continue to slow  down from 3.7% to 3.1% (from 5% in 2023). In Turkey, the growth rate  will slow down from 3% to 2.7% (from 5.1% in 2023). In Russia, after  maintaining the rate at 3.6% (as in 2023), a slowdown will follow to  1.3%. In Belarus, the growth rate will continue to slow down from  3.6% to 2.3% (from 3.9% in 2023). In Kazakhstan, there will be a  slowdown to 3.5% (from 5.1% in 2023), followed by an acceleration to  4.6%.  In Kyrgyzstan, growth is expected to accelerate to 6.5% (from  6.2% in 2023), followed by a slowdown to 5%.

According to the current account deficit/surplus to GDP ratio in  these countries, the IMF predicts the following for 2024-2025: in  Georgia, the deficit will continue to grow from 5.8% to 5.9% (up from  4.3% in 2023); in Azerbaijan, the surplus will decrease from 6.1% to  5.9% (down from 11.5% in 2023); in Iran, the surplus will slowly  increase from 2.9% to 3% (up from 2.8% in 2023); in Turkey, the  deficit will decrease from 2.2% to 2.1% (down from 4% in 2023); in  Russia, the surplus will first increase to 2.7% (up from 2.5% in  2023) and then decrease to 2.6%; in Belarus, the deficit will  continue to grow from 2% to 2.4% (up from 1.8% in 2023); in  Kazakhstan, after decreasing to 1.5% (down from 3.3% in 2023), the  deficit will increase to 2.7%; and in Kyrgyzstan, the significant  deficit will continue to sharply decrease from 21.7% to 6.5% (down  from 48.2% in 2023).