YEREVAN, June 7. / ARKA /. The Central Bank of Armenia said today in a press release that its Board has decided to leave the benchmark refinancing rate unchanged at 8.5%. According to the press release, inflation in 2011 May grew by 0.04% from April, resulting in a 9 percent 12-month inflation growth, increasing by 0.1 percentage point from the previous month’s figure.
The Board has noted also that inflationary pressures coming from the external sector have weakened due to drop in the prices of basic commodities at the beginning of the month, while food prices have remained stable.
The CB Board has concurred that domestic economy impulses impacting the inflation rate remain neutral while weak inflationary pressures in the labor market are being neutralized by the slow growth of private spending and deterrent fiscal policy. At the same time, the Board projects a decline in prices of local agricultural products together with increased production compared to last year. The Central Bank Board believes that the likelihood of inflationary environment expansion is fairly low, saying it can be curbed with the help of current interest rates to make it fluctuate within the permissible range of 4% (± 1.5%) .
The last time the Central Bank raised the refinancing rate by 0.25 percentage points was on April 13, 2011, bringing it up to 8,5%. According to the state budget, the 2011 inflation s projected at 4 ± 1,5% . -0-
