YEREVAN, August 4. /ARKA/. From July 14 to July 28, the Armenian stock market demonstrated mixed dynamics. During the reporting period, Telecom Armenia (AMTL) shares corrected by 0.5%, while the decline since the beginning of the month was 2.1%. This brought the quotes closer to their average annual value. Fundamentally, the company announced the launch of a new solar power plant in the Gegharkunik region with an annual output of 16 million kWh, thereby strengthening its position in the renewable energy segment.
ACBA Bank (ACBA) shares traded without significant changes amid an absence of notable news.
The price index of three-year corporate bonds remained stable, reflecting stabilized inflation and expectations of the Central Bank’s neutral monetary policy. Meanwhile, the dram-to-dollar exchange rate (AMD/USD) remains stable, trading near multi-year lows. Improvement in the foreign trade balance is key to supporting the national currency. Data for June indicate a strong recovery in exports and a reduction in the trade deficit. If this trend continues, combined with a steady inflow of remittances, it could bolster the local currency in the future.
Taken together, Armenia’s macroeconomic picture paints a portrait of an economy in a phase of “healthy normalization.” After a brief surge, economic activity is slowing to a more sustainable pace as expected, inflation is stabilizing near the target, and the industrial sector and foreign trade balance are improving.
Economic News
From July 14 to July 28, 2025, the National Statistical Committee of Armenia released macroeconomic statistics on the economy. Foreign trade recovered slightly due to export growth in June, and economic activity growth remains elevated despite slight cooling month over month. Statistics from the industrial sector also indicate positive trends.
Foreign trade is showing signs of recovery. In June, foreign trade turnover decreased by 16.6% year over year (y/y), though it grew by 9.4% month over month (m/m). Exports from Armenia decreased by 15.9% year over year (y/y), but grew by 23.0% month over month (m/m) to nearly $730 million. Imports, in turn, fell by 17.1% year over year to nearly $1.002 billion, which is 0.9% higher than the value in May. These dynamics led to a decrease in the foreign trade deficit to approximately $272 million, contrary to expectations of maintaining it at the May level of approximately $400 million. These dynamics continue to support the dram exchange rate, which remains close to multi-year lows against the dollar.
• Although economic activity growth cooled slightly month-over-month, it remains solid. In June, the Economic Activity Index increased by 8.6% year over year (y/y) and by 8.8% month over month (m/m), which is slightly below the expected growth of +9.0% y/y and the May figure of +10.4% y/y. Nevertheless, this figure significantly exceeded the average indicator since the beginning of the year (+5.7% year over year). The construction sector was the main driver of growth (+22.6% y/y), supported by large infrastructure projects, such as the Kajaran tunnel. The service sector (excluding trade) grew by 8.2% year over year (y/y), and retail trade statistics grew by 2.8% y/y in June, which is an improvement over the expected -0.4%. These figures indicate an improvement in consumer demand in the country.
The growth of the producer price index moderately accelerated in June to 2.5% year over year (forecast: 3.0%), which, combined with a slowdown in the decline of the industrial sector, may indicate the beginning of a recovery. If this recovery continues at a sustainable pace, it could provide positive momentum to the country’s economic growth.
Company News:
•Team Telecom Armenia (AMTL) has strengthened its position in the renewable energy sector by launching a solar power plant in Gegharkunik with an annual output of 16 million kWh. This project aligns with the country’s significant solar potential (1,720 kWh/m² per year) and the government’s support of clean energy. This development could moderately impact the company’s stock price in the medium term, as improved infrastructure and access to its own electricity could gradually increase margins in its core business.
• Armenian startup DeepSat announced the launch of a constellation of satellites in a very low Earth orbit (VLEO) for Earth observation in partnership with Redwire Space Corporation. The satellites will use Redwire’s Acorn 2.0 and DEMSI technologies. The project, announced through Arka Telecom, strengthens Armenia’s position in the global space industry.
Expectations for the Next Two Weeks
A number of significant macroeconomic data for June will be published between August 1 and August 11, 2025. At the same time, updated or revised statistics on previously published metrics may be released.
In the coming week, investors will focus on the release of July’s inflation data (CPI) and the Central Bank’s decision on the refinancing rate. The market forecast assumes inflation will slow to 3.5% year over year in July, compared to 3.9% in the previous month. At the next meeting, the decision on the refinancing rate is unlikely to bring any significant surprises. In the baseline scenario, we expect the rate to remain at 6.75% because inflation has remained close to the regulator’s target corridor in recent months. However, the decision depends on several factors, including the July inflation statistics. These two events will likely determine market sentiment in the short term.
The GDP growth rate for Q2 will be published after the specified period. The previous value was 5.2% year over year, indicating the maintenance of sustainable economic growth rates. This data will enable us to adjust our growth trajectory expectations for the second half of the year and provide additional information on domestic demand, production activity, and the state of the economy as a whole.-0-
