YEREVAN, September 8. /ARKA/. ‘We expect that CBA’s monetary policy will help stabilize inflation around 4 percent in the period ahead. Jihad Azour’, Head of Middle East and Central Asia Department at the International Monetary Fund (IMF), said in an exclusive interview with ARKA news agency.
Azour commend the Central Bank of Armenia for being one of the most proactive central banks in addressing high inflation in 2021-22. He said the increase in the policy rate to 10.75 percent during that period helped contain inflation and inflation expectations.
He said in the last few months, the inflation rate has come down unexpectedly fast, which is due to dram appreciation, and falling food and transportation prices. These recent inflation developments underscore that uncertainty to the outlook remains very high.
‘On one hand, food and commodity prices and rapidly subsiding inflation in trading partners are expected to put downward pressure on inflation. On the other hand, high wage growth and credit expansion together with strong domestic demand may keep inflation pressures elevated. As with other economic projections, our staff are now working on revisions that will be finalized after the September mission,’ Azour said.
In the past two months, there was an evidence of deflation in the country: in June, prices decreased by 0.5%, and in July – by 0.1% in annual terms. -0-
