Central Bank of Armenia reduces refinancing rate by 0.25pp to 7.75%

Central Bank of Armenia reduces refinancing rate by 0.25pp to 7.75%

YEREVAN, December 24. /ARKA/. The council of the Central Bank of Armenia (CBA) made a decision to reduce the refinancing rate by 0.25 percentage points to 7.75% at its meeting at CBA’s education and research center in Dilijan, the regulator’s press office reported Tuesday.

Inflation constituted 0.9% in November as compared to 1.4% in the same period of 2012, the 12-month inflation continued reducing and was 6.6% as of the end of the month. Inflation rate is decreasing more rapidly than projected, which means 12-month inflation will be closer to the upper limit of the targeted level by the end of the year.

The council said external developments were mainly within the limits of the projections. Slow recovery trends are maintained in global economy. No inflationary pressures are expected on the international primary goods and food markets.

According to the council, low economy growth rates are maintained despite expansionary tax and budget policy, due to behavior of investments and slowed-down rates of private consumption growth.

Bearing in mind the above developments and the expected reduction in inflation in future, the council considers it worth to continue easing monetary and credit terms.
 
The council believes the 12-month inflation will continue reducing: and will be back to the 4% target level in the next months and will be within the allowable limits in projected future.

In its last review the Central Bank of Armenia reduced the refinancing rate by 0.5 percentage points to 8% on November 12, 2013.

Under Armenia’s government budget for 2013, inflation is 4 (±1.5%), GDP growth is 6.2%. Projected inflation level for 2014 is the same and GDP for 2014 is 5.2%. –0—

18:23 24.12.2013

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