Armenian Central Bank cuts interest rate by 0.5 pct

YEREVAN, July 7. /ARKA/. The Central Bank of Armenia (CBA) cut today the annual interest rate by 0.5pct to 5.5%, the CBA press service reports.

The Central Bank cited 0.3% deflation in Armenia between May and June 2009, with the monthly inflation – 1pct lower than the CBA forecasts.

With a stable national currency, the global price hikes affected Armenia’s domestic prices, the CBA Board said, adding the country posted lower-than-expected inflation amid the economic downturn.

The Central Bank stressed the importance of cutting interest rates, despite the looming prospects of the government’s anti-crisis program and the global recovery.

This is the fifth time CBA has cutting the interest rate since the country officially returned to the flexible exchange rate policy on March 3, with the Central Bank setting the annual interest rate at 7.75%.

On April 7, the Central Bank lowered the benchmark interest rate up to 7.5%, compared to 7.25% on May 12.

On May 22, CBA cut the interest rate by 1.0pct to 6.25%, compared to 6% on June 9. Z. Sh.—0--