YEREVAN, JANUARY 29, ARMENPRESS. The Board of the Central Bank of Armenia has made a decision at its January 29 session to lower the refinancing rate by 0,25% - setting it at 5,75%, the cenbank said in a press release.

It said that a 1,5% inflation was recorded in December of 2018, and the 12-months inflation totaled 1,8% - the prices of seasonal goods were formed in relatively low levels, and the normal inflation decreased to some extent. As a result, the low inflation environment will be maintained during the coming months and the 12-months inflation will be developed at the lower level of the confidence band’s lower part, the cenbank estimates.

Global economic growth trends show certain weakening signs in both leading and developing countries, while central banks of leading countries continue tightening monetary policies.   As a result, weakening trends of inflation environment are maintained in international markets of main goods, proceeding from which the Central Bank estimates that no inflation pressures are expected from the foreign sector in the coming months.

The CB board recorded that the last economic activity of 2018 continues being weak, while the year’s economic growth is expected in the range of 5,0%.

The board assessed that the low inflation is partly of structural nature – associated with long-term changes of economic and state policy, which also contributes to maintenance of purchasing power of revenues and anchoring the inflationary expectations in the country. 

It is expected for the inflation to be still running below the lower part of the confidence band and stabilizing around the 4% value at the end of forecast horizon.     

Edited and translated by Stepan Kocharyan