JUNE 24 2014 (The Conway Bulletin) – Armenia’s Central Bank cut its key interest rate by 0.25% for the third time this year because of continued falling inflation.
The new 7% interest rate is the lowest set by the Armenian Central Bank for four years, reflecting concern over an economy that is bouncing along the bottom of economists’ forecasts.
Like other parts of the former Soviet Union, the unrest in Ukraine and the sanctions on Russia have impacted Armenia and slowed its economic prospects.
The Central Bank was succinct.
“There was 0.8 percent of deflation in May of 2014,” it said.
“In the coming months, the Board considers, that the inflation rate will keep on easing as the impact of energy prices, increased in July 2013, phases out, and it will further pace down (to) the lower boundary of the confidence band most probably during the third quarter.”
In other words, Armenia’s Central Bank is gently warning that its economic indicators will worsen further before there is any sign of improvement.
ENDS
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(News report from Issue No. 190, published on June 25 2014)