YEREVAN, December 24. /ARKA/. The inflation rate in Armenia may reach 2% by the end of 2024, predicts the head of the Central Bank of Armenia, Martin Galstyan.
According to him, inflation in Armenia as of November 2024 is about 1.4%, which is lower than the previously projected figure.
“The main goal of the Central Bank is price stabilization. The legislature had previously set the inflation target at 4%. This was the case until recently, but now the target has been reduced to 3% at the initiative of the Central Bank. The fact is that all our studies, both theoretical and practical, have clearly shown that people’s expectations of price stabilization are centered around 3% inflation,” Galstyan said in an interview with Public Television of Armenia.
As the head of the Central Bank noted, the inflation rate will gradually decrease, which will have a positive effect on the country’s economy. According to Galstyan, this approach will significantly reduce inflationary fluctuations.
“In other words, the lower the inflation rate and the closer we are to the target, the fewer fluctuations will occur,” said the head of the Central Bank.
Impact on Investments
Galstyan also explained why, despite low inflation and relatively high financial and credit stability, investments in Armenia are declining.
“One simple truth should be understood — our country is not in a vacuum. The investment environment is influenced by many factors, including exogenous (external) ones. These include geopolitical events, the country’s attractiveness as a place for doing business, and more. We have significant work ahead in addressing structural issues,” Galstyan said in the interview.
He emphasized that macrostability is crucial and cannot be overlooked, as it is an important factor in attracting investment.
Figures and Economic Forecasts for Armenia
The economic growth forecast for Armenia in the 2024 state budget is 7%, while the budget for 2025 projects GDP growth of 5.1%.
According to the Central Bank’s monetary policy report for the fourth quarter of the current year, Armenia’s GDP growth for 2024 is expected to be 6%, with projections for 2025 ranging between 7.1% and 4.8%, for 2026 between 4.7% and 7%, and for 2027 between 5% and 6.2%.
The EDB forecasts a 6% GDP growth for Armenia in 2024 and 5.5% in 2025. The World Bank expects a 5.5% growth in 2024 and 5% in 2025. The IMF forecasts a 6% growth for 2024 and 4.9% for 2025. The EBRD projects a 6.2% growth in 2024 and 4.8% in 2025. The ADB forecasts 5.7% for 2024 and 6% for 2025. According to Fitch Ratings, Armenia’s economy will grow by 6% in 2024 and 4.9% in 2025. S&P forecasts a 6.2% growth for 2024, while the UN expects the Armenian economy to grow by 5.2% in 2024 and 4.8% in 2025.
