In 2024, Armenia`s inflation rate  was 1.5%  

ArmInfo. Inflation of 1.5% was recorded in the consumer market of Armenia in January-December 2024 compared to the deflationary 0.6% in 2023. This increase was driven by a 2.2% rise in food prices and a 2.5% increase in service tariffs, while non-food prices decreased by 1.8%. In contrast, the previous year saw a more significant increase in prices across all three  categories, with 3.5%, 3% and 0.1%, respectively. This is evidenced  by data of the RA Statistical Committee, according to which the  average monthly price growth on the consumer market was 0.1% in  January- December 2024, in contrast to a 0.1% decline in 2023. In  annual terms (compared to January-December 2023), inflation decreased  to 0.3% (from 2% a year earlier). This decrease was facilitated by a  1.2% decrease in the price of food products and a 0.8% decrease in  non-food products, with a slight slowdown in the growth of tariffs  for services to 3%. 

A year earlier, in January-December 2023, compared to  January-December 2022, both food and non-food products became more  expensive. However,  there was a sharp slowdown in price growth, with  food products increasing by 0.4% and non-food products by 1.7% (down  from 12.5% and 7%, respectively).  Tariffs for services also showed a  slowdown in growth (from 5.2% to 4.5%). Vegetables increased in price  by 9.7% in January-December 2024 (following a reversal in prices in  2023 from 2.1% growth to a 6.6% decline). Meanwhile, fruits fell in  price by 0.1% compared to a slowdown in price growth in 2023 from  10.9% to 0.7%. In December alone, both vegetables and fruits  increased in price by 12.2% and 2.4%, respectively (similar to growth  of 10.6% and 5.6% in December 2023). The average weighted inflation  in the vegetable and fruit group was 8.42% in December. This group of  products, accounting for 9.04% of the consumer basket, had an upward  effect on inflation by 0.74 percentage points (with December  inflation at 1%, against 0.9% a year ago).

Among food products, the following increased in price in 2024: coffee  - by 16.2%, sunflower oil - by 10.6%, butter - by 9.1%, trout - by  7.1%, chocolate - by 6.6%, flour - by 5.2%, lamb - by 4.7%, tea - by  4.3%, lentils - by 2.8% and beans - by 2.8%. In 2024, margarine fell  in price by 9.2%, pasta by 5.1%, condensed milk by 4.5%, cheese by  4.4%, sugar and granulated sugar by 4.2%, pork by 4%, poultry by  3.7%, eggs by 3.7%, flour by 2.1%, beef by 1.6%, rice by 1.3%, milk  by 0.8% and cottage cheese by 0.2%.  The growth in cigarette prices  slowed significantly from 11.5% in 2023 to 1.1% in 2024. Among  alcoholic beverages, vodka and beer increased in price more  significantly in 2024 - by 9.5% and 3.3%, respectively compared to  growth of 8.3% and 2.6% in 2023), while wine prices decreased from a  1.7% increase in 2023 to a 1.5% decline in 2024. In the non-food  market, jewelry increased in price by 14.8% in 2024, gardening  equipment - by 5.7%, large and small household appliances - by  2.4-5%, and medicines - by 3.5%. Non- food products such as  disposable household goods decreased in price by 5%, clothing and  footwear by 3.4% and 1.2%, medical equipment by 3.1%, building  materials by 2.4%, furniture by 1.5%, and tableware and kitchen  utensils by 1.4% in 2024.

Gasoline and diesel fuel prices decreased by 6% and 9.4% in 2024,  compared to a 24.3% and 0.2% increase in 2023. From January to  December 2024,  prices for gasoline and diesel fuel rose by 14.8% and  1.7% compared to the same period in 2023, which had seen a decrease  of 11.9% and 12.8%. In the service sector, the most significant price  increases from December 2023- December 2024 were for services related  to personal transport, which rose by 3.1 times,  transport insurance  - by 18.9%,  comprehensive recreation services - by 15.6%, transport  services - by 5.8%, preschool and primary education - by 12.3%,  higher education - by 7%, hairdressing and SPA salon services - by  4.6%, medical services - by 3.6%, and repair of household appliances  - by 2.3%. Apartment renovation services increased by 3.8% over the  year, while dry cleaning, clothing repair services, and clothing  rental salons increased in price by 5.6% over 2024.  Financial  services saw a  1% increase over the reporting year. In 2024, only  postal services saw a decrease in price by 5%, and hotel services  decreased by 3.8%.

In December consumer market inflation was 1%, accompanied by a 1.9%  devaluation of the dram against the dollar compared to 0.9% inflation  and a 0.5% devaluation in December 2023. Throughout January to  December 2024, consumer market inflation was 1.5%, paired with a 2%  revaluation of the dram against the dollar by compared to a 0.6%  deflation and a 2.5% devaluation in January-December 2023. By  December 2024, the dram had strengthened against the dollar to AMD  396.5/$1 from AMD 404.5/$1 in December 2023.

It is noteworthy that the inflation rate forecasted by the Central  Bank of Armenia for 2024 differed only slightly from the actual  recorded figure - 1.6% (according to Case B) against the actual 1.5%.  Let us recall that in its December forecast report, the Central Bank  of Armenia predicted inflation of 2.1% (according to Case A) and 1.6%  (according to Case B) for 2024, against a deflationary 0.6% in 2023.  However, in 2025, according Central Bank of Armenia's forecast, there  will be growth to 3.9% (according to Case A) or to 3.2% (according to  Case B). Moreover, according to the Central Bank's expectations,  inflation in the segment of non-exportable goods with rigid prices  will decrease in 2024 to 2.6% (from 4.8% in 2023), after which it  will increase to 4-2.8% in 2025. The International Monetary Fund  predicted a lower inflation rate of 1% for Armenia in 2024, while  expecting growth to reach 3.9% in 2025. It should be noted that on  December 11, 2024, the Central Bank of Armenia announced that  starting from 2025, the inflation target is set at 3% with a range of  permissible deviations of +/- 1 percentage point, against the  previous 4% (+/- 1.5).  The RA Law "On the State Budget of Armenia  for 2025" stipulates that the Central Bank will henceforth be guided  by this inflation target (3%, +/- 1) when making decisions on  monetary policy.