YEREVAN, December 6. / ARKA /. Bank deposits in Armenia’s national currency, the dram, surged by 28.7% year-on-year in 2016 September, while deposits in foreign currency saw a 12% rise, the central bank said in its regular inflation report.
According to the report, the fast growth of dram deposits was due to the reduction in inflation expectations, which in turn led to a 2 p.p. fall in the 12-month dollarization level.
However, the prolonged weakening of monetary conditions by the Central Bank in quarter III of 2016, an increase in the liquidity of commercial banks due to the replenishment of capital, as well as a reduction in interest rates in the financial market had a significant impact also on the value of interest rates of commercial banks.
Thus, according to the Central Bank, in the quarter 3 there was a decrease in interest rates on almost all types of loans, while in September 2016 the overall 12 month rate of lending amounted to 4.1%.
Armenia’s Central Bank has reduced its refinancing rate sixth times this year from 8.75% to 6.75%.-0-
