ArmInfo. The Central Bank of Armenia raised the refinancing rate by another 0.25%, from 6.75% to 7%. This decision was made on November 3 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 8.5%, and on deposits attracted from banks, to 5.5%.
Prior to this, after nine months of unchanged rates, effective September 15 of this year. The refinancing rate was raised from 6.5% to 6.75%, which led to an increase in rates on Lombard repos to 8.25% and on deposits 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 December 2025. 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 further away in light of the renewed growth of the key rate.
According to statistics, in September 2026 compared to September 2025, inflation was recorded at 4.3%, against inflation of 3.7% in September 2025 compared to September 2024. The Central Bank's baseline annual inflation rate for September was 4.7%, compared to 3.5% a year earlier in the same period.
Central Bank Chairman Martin Galstyan presented a detailed rationale for the Central Bank Council's decision to further raise the refinancing rate today at a press conference, which is also being 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 lowered to 6.5% for the second time in a year. This level remained in place until September 15, 2026, when it was increased to 6.75% and then again a month later, from November 3, to 7%.
It should be noted that, starting in 2025, the inflation target is set at 3% with an acceptable range 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 the joint approach of the Central Bank and the Government towards the prospects for long-term stable economic growth and improving public welfare.
