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Armenian CB Raises Annual Refinancing Rate

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  • Armenian CB Raises Annual Refinancing Rate

    ARMENIAN CB RAISES ANNUAL REFINANCING RATE

    ARKA
    Sep 3, 2008

    YEREVAN, September 3. /ARKA/. The Board of the Central Bank of
    Armenia (CBA) decided to raise the annual refinancing rate by 0.25%
    up to 7.75%.

    The CBA Board confirmed the weakening inflationary pressure this
    August, which, however, has not affected the domestic prices. The main
    reason is both obstacles to the import of products to Armenia as a
    result of the latest developments in the region and slow reaction of
    domestic prices to external factors because of the defective market
    for some products.

    The CBA Board believes that keener domestic demand will not cause new
    inflationary pressures provided the obstacles to the import of goods
    to Armenia are removed soon. Otherwise, there is a serious risk of
    higher inflation rates and lower long-term economic growth rates.

    The CBA Board attaches high importance to the task of lowering
    inflation expectations in the country and reducing any deviations
    from the inflation targets to a minimum in the context of the current
    developments in the region and their unpredictability. The CBA Board
    is sure that further specification of the refinancing rates will
    depend on the regional developments, reaction of domestic prices to
    international prices.

    An inflation rate of 0.7% was recorded in Armenia this August. However,
    an annual inflation rate of 11.5% was recorded in Armenia - a
    rise of 0.8%, which resulted from the latest devel opments in the
    region. Specifically, a rise in the prices for baked goods was
    recorded instead of the forecast fall. An inflation rate of 4%
    (±1.5%) is budgeted in Armenia for this year

    --Boundary_(ID_1rlonUrluZM5LVCPMYx5nA)--
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