YEREVAN, July 13. /ARKA/. The week in Armenia’s financial market was marked by accelerating annual inflation and activity in the government and corporate securities markets. The monetary agenda focused not only on consumer price dynamics in June but also on factors shaping the inflation environment, including the exchange rate, food prices, and public expectations. The regulatory agenda included the results of the anti-money laundering system assessment and further financial compliance requirements.
1. Inflation: Annual rate reached 5.1% in June
The Statistical Committee of Armenia reported that 12-month inflation in June 2026 was 5.1%. Compared to May, consumer prices decreased by 0.5%. Annual inflation is above the Central Bank’s target of 3%, with an acceptable range of ±1 percentage point, and monthly deflation indicates the difference between current price dynamics and cumulative annual growth.
For banks and debt market participants, inflation indicators remain the basic parameter for assessing the real return on deposits, loans, and bonds. For the regulator, these data can shape the current context for monetary policy, given the current refinancing rate of 6.5%.
2. Foreign Exchange Market: The dollar remained near 367 drams.
The official US dollar exchange rate for the workweek of July 6-10 changed from 367.47 drams to 367.38 drams. The euro exchange rate increased from 419.65 drams to 420.03 drams, and the Russian ruble exchange rate increased from 4.7311 drams to 4.7873 drams.
The current exchange rate dynamics maintain stable conditions for servicing foreign currency liabilities and conducting foreign trade settlements. This may indicate no significant changes in the revaluation of foreign currency assets and liabilities during the reporting week.
3. Financial compliance: Armenia has been transferred to enhanced monitoring mode MONEYVAL
On July 9, the Council of Europe MONEYVAL Committee published a report on the results of the sixth round of mutual assessment of Armenia’s system to combat money laundering, the financing of terrorism and the proliferation of weapons of mass destruction. Experts noted the development of the national risk management system, the work of the financial regulator and the financial intelligence unit, while pointing out the need to improve the efficiency of investigations, confiscation of criminal assets and supervision of individual sectors.
The report pays special attention to service providers related to virtual assets, investment funds and the quality of information about ultimate beneficial owners. Armenia has been placed into an enhanced follow-up monitoring regime, which includes regularly informing MONEYVAL about the implementation of recommendations. and must submit a first progress report within three years.
For banks, investment companies and other financial institutions, the assessment results may reinforce the need for further customization of KYC procedures, monitoring transactions and assessing cross-border risks. Requirements to document sources of funds and customer ownership structure remain central to compliance functions.
4. Government bonds: operations worth 78 billion drams were carried out on AMX
On July 7, the Armenian Stock Exchange held an auction to place government bonds worth 70 billion drams, as well as two auctions to buy back securities with a total volume of about 8 billion drams. The weighted average yield of the 11-year issue upon placement was 8.6064% with an annual coupon rate of 9%. The redemption was carried out on three-year and five-year bonds. The yield at the weighted average price was 6.7009% and 6.7726%, respectively.
For banks and institutional investors, the transactions carried out can create additional benchmarks for profitability in different parts of the dram curve.
5. Capital Markets: Equity Market Capitalization Exceeds AMD 492 Billion
According to AMX, the capitalization of the Armenian equity market at the end of June exceeded AMD 492.7 billion, an increase of 7.43% over the month. Exchange trading volume in equities increased by 10%, while the volume of corporate bond transactions reached AMD 17.2 billion, an increase of 129% year-on-year. Transactions worth over AMD 33.3 billion were concluded on the secondary government bond market. The volume of repo transactions exceeded AMD 28.9 billion, with 211 such transactions.
For banks and investment companies, this may mean an increase in the range of available liquidity management and portfolio construction tools.
6. Corporate Bonds: EBRD Places AMD Floating-Rate Issue
The European Bank for Reconstruction and Development (EBRD) placed floating-rate coupon bonds on the AMX platform. The total issue volume was 5 billion drams, of which 4 billion drams were placed through the exchange platform. Converse Bank acted as the underwriter.
The issue may expand the segment of dram-denominated debt instruments of international financial institutions and provide market participants with a yield linked to the short-term government benchmark. For investors, the floating rate may reduce the discrepancy between coupon income and changes in market rates.
7. Institutional Investors: Non-Resident Share in Dram Bonds Increases to 10%
Non-resident investments in Dram bonds from January to May 2026 nearly doubled compared to the same period last year, according to Armen Ktoyan, a member of the Board of the Central Bank of Armenia. The share of foreign investors in this segment reached 10%.
The increased presence of foreign participants may mean an expansion of the investor base and increased requirements for information disclosure, liquidity of issues, and the organization of secondary circulation. Portfolio investments also serve as a source of foreign currency supply for the foreign exchange market. 8. Inflation Environment: The Central Bank Identifies Five Key Factors
Armen Ktoyan, a member of the Board of the Central Bank of Armenia, identified five key factors influencing inflation in the country. These include the strengthening of the dram, structural features of the economy, rising prices for certain food products, external inflationary pressures, and public expectations.
The Central Bank’s assessment shows that structural constraints influencing current inflation dynamics, including logistics and the specifics of individual commodity markets, are compounded by changes in global commodity and energy prices.
The combination of these factors can determine the conditions for assessing interest rate and credit risk. For the financial market as a whole, inflation expectations remain one of the parameters influencing demand for savings and debt instruments.
Weekly Summary
This week showed that the primary focus is shifting to assessing the sustainability of inflationary processes, the quality of financial compliance, and the development of dram-denominated debt instruments. Key areas of focus for market participants remain inflation expectations, the dynamics of individual food categories, MONEYVAL requirements, government bond yields, and non-resident participation in local financial instruments.
