Armenian central bank halts easing cycle keeping key rate unchanged at 6 percent
28.03.2017,
18:26
Armenia’s Central Bank has decided today to keep the refinancing rate at 6%, saying that 0.9% deflation was recorded in February, down from 1.4% deflation recorded a year earlier.
YEREVAN, March 28. /ARKA/. Armenia’s Central Bank has decided today to keep the refinancing rate at 6%, saying that 0.9% deflation was recorded in February, down from 1.4% deflation recorded a year earlier. As a result the 12-month inflation was minus 0.2%.
The Central Bank said it believes that the 12-month inflation will continue to recover and consolidate around the projected target band of 4% (± 1.5%).
It said also external tendencies were mainly preserved: the global economy continues to grow at a slow pace, and there was a larger than expected expansion of the inflationary environment in global commodity markets.
The Central bank said also it does not expect a significant inflationary impact from the external sector in the coming months, despite the risks associated with US Federal Reserve’s plans to raise the rates and the flow of capital from emerging and development countries to USA.
The regulator stated that economic activity in Armenia in January-February exceeded expectations, mainly due to greater than expected growth of industry, services and trade. At the same time, domestic demand is gradually recovering, thanks to the impact of monetary and fiscal policies implemented in 2015 and 2016.
The Central Bank said that after having cut the refinancing rate 12 times over the past two years by 4.5 percent it will halt the easing policy because rates lower than the current level may have undesirable effect on development of economy's real and financial sectors. -0-
The Central Bank said it believes that the 12-month inflation will continue to recover and consolidate around the projected target band of 4% (± 1.5%).
It said also external tendencies were mainly preserved: the global economy continues to grow at a slow pace, and there was a larger than expected expansion of the inflationary environment in global commodity markets.
The Central bank said also it does not expect a significant inflationary impact from the external sector in the coming months, despite the risks associated with US Federal Reserve’s plans to raise the rates and the flow of capital from emerging and development countries to USA.
The regulator stated that economic activity in Armenia in January-February exceeded expectations, mainly due to greater than expected growth of industry, services and trade. At the same time, domestic demand is gradually recovering, thanks to the impact of monetary and fiscal policies implemented in 2015 and 2016.
The Central Bank said that after having cut the refinancing rate 12 times over the past two years by 4.5 percent it will halt the easing policy because rates lower than the current level may have undesirable effect on development of economy's real and financial sectors. -0-
