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RF CB CHAIRMAN: CENTRAL BANK OF ARMENIA ACHIEVES GREAT SUCCESS IN INFLATION CONTROL
Noyan Tapan
Nov 04 2006
YEREVAN, NOVEMBER 4, NOYAN TAPAN. Issues related to inflation control
in Armenia and Russia, the appreciation of the Armenian dram and the
Russian ruble, response of the real sector, particularly exporters to
this appreciation, etc. were discussed during the meeting of Chairman
of the Central Bank of Armenia (CBA) Tigran Sargsian and Chairman
of the RF Central Bank Sergei Ignatyev in Yerevan on November 3. The
chairmen of the central banks of the two countries stated this at a
joint press conference on the same day. In S. Ignatyev's opinion,
the CBA "has achieved great success" in controlling inflation,
as Armenia's "microeconomic indices are very high, while the
inflation is quite low - much lower than in Russia." In his words,
under conditions when the nominal and real values of the national
currency strengthen, non-tradable sectors (e.g. construction) grow
at a higher rate and difficulties arise with the development of
the processing industry. "This problem is inevitable: the indicated
processes should be watched closely, with some corrections being made
in the macroeconomic policy. Nevertheless, the real sectors of the
economies of Armenia and Russia adapt to this process quite rapidly and
effectivel," S. Ignatyev said. In his words, in a few years Russia will
be ready to transfer to inflation targeting and a floating exchange
rate of the ruble, which Armenia did in 2006. S. Ignatyev noted that
Russia cannot now use the inflation targeting policy because of the
considerable impact of oil prices on the inflation.
Noyan Tapan
Nov 04 2006
YEREVAN, NOVEMBER 4, NOYAN TAPAN. Issues related to inflation control
in Armenia and Russia, the appreciation of the Armenian dram and the
Russian ruble, response of the real sector, particularly exporters to
this appreciation, etc. were discussed during the meeting of Chairman
of the Central Bank of Armenia (CBA) Tigran Sargsian and Chairman
of the RF Central Bank Sergei Ignatyev in Yerevan on November 3. The
chairmen of the central banks of the two countries stated this at a
joint press conference on the same day. In S. Ignatyev's opinion,
the CBA "has achieved great success" in controlling inflation,
as Armenia's "microeconomic indices are very high, while the
inflation is quite low - much lower than in Russia." In his words,
under conditions when the nominal and real values of the national
currency strengthen, non-tradable sectors (e.g. construction) grow
at a higher rate and difficulties arise with the development of
the processing industry. "This problem is inevitable: the indicated
processes should be watched closely, with some corrections being made
in the macroeconomic policy. Nevertheless, the real sectors of the
economies of Armenia and Russia adapt to this process quite rapidly and
effectivel," S. Ignatyev said. In his words, in a few years Russia will
be ready to transfer to inflation targeting and a floating exchange
rate of the ruble, which Armenia did in 2006. S. Ignatyev noted that
Russia cannot now use the inflation targeting policy because of the
considerable impact of oil prices on the inflation.