Central bank of Armenia reduces refinancing rate by 0.25pct down to 7.25% p.a.

YEREVAN, May 13. /ARKA/. The Central Bank of Armenia (CBA) brought the refinancing rate 0.25pct down to 7.25% p.a.
The CBA Press Service reported that the respective decision was adopted on yesterday’s meeting of the CBA Board.

According to the report, The CBA Board stated that the current inflationary developments are largely in harmony with the trends outlined for the period.

Inflation rate, as it was expected, started speeding up in the second quarter, yet it has not exceeded the upper target limit.

Further inflation will depend on indirect impact of the April rise in prices for public services to show up within the next months, as well as on further adjustment of prices for imported goods and the Dram devaluation that started in early March this year.

According to the press release, the lower GDP level than the balanced one for the period under review and outer deflationary environment are expected to scotch influence of the above factors on general price levels.

Under the current and the expected microenvironment conditions, the CBA Board considers it worth to continue “broadening” monetary and credit policy.

3.2% inflation was recorded in Armenia in April against March; annual inflation grew by 2.1pct up to 3.1% in the period as compared with the previous month.

Inflation is to reach 4% (±1.5%) in Armenia by the end of 2009 as per the state budget. –0--