ArmInfo. The Central Bank of Armenia raised the refinancing rate from 6.5% to 6.75%, after nine months of no change. This decision was made on September 15 at a meeting of the Central Bank of Armenia's Board. According to this decision, the rates on Lombard repos were also increased by 0.25 percentage points to 8.25% and on deposits attracted from banks to 5.25%.
In total, from mid-2023 to 2026, the key rate was reduced by 4.25 percentage points - from a historical maximum of 10.75% to 6.5% in December 2025, remaining at this level until September 15 of this year. Accordingly, over this period, rates on Lombard repos and on deposits attracted from banks decreased by the same amount (by 4.25 percentage points) – from the maximum rates of 12.25% and 9.25%, respectively, recorded in December 2022 (and maintained until June 2023) to 8% and 5% in August of this year. However, these levels of the refinancing rate, Lombard repos, and on deposits attracted from banks turned out to be far from the minimum levels of 4.25%, 5.75%, and 2.75%, respectively, recorded in the second half of 2020, and have now moved even further away.
According to statistics, in August 2026 compared to August 2025, inflation was recorded at 4.4%, against inflation of 3.6% in August 2025 compared to August 2024. The Central Bank's baseline annual inflation rate for August was 4.8%, compared to 3.7% a year earlier in the same period.
Central Bank Chairman Martin Galstyan will present a detailed rationale for the Central Bank Board's decision to raise the refinancing rate this time today at a press conference, which will also be broadcast online.
As a reminder, the Central Bank of Armenia, after 2.5 years (from December 2020 to mid-2023) of raising the refinancing rate from a minimum of 4.25% to a maximum of 10.75% (i.e., by 6.5 percentage points), began cutting the key rate starting June 13, 2023, continuing this policy in 2024 and 2025. Specifically, in February 2025, the key rate was reduced from 7% to 6.75%, maintaining this level until mid-December, when it was reduced for the second time in a year to 6.5%. This level remained in place until September 15, 2026, when it was increased to 6.75%.
It should be noted that, starting in 2025, the inflation target is set at 3% with a tolerance of +/- 1 percentage point (versus the previous 4%, +/- 1.5 percentage points). From now on, the Central Bank will be guided by this inflation target when making monetary policy decisions. Reducing the inflation target is an important prerequisite for the implementation of a joint approach by the Central Bank and the Government to ensure long-term stable economic growth and improved social welfare.
