The Eurasian Development Bank (EDB) has released a forecast predicting accelerated price growth in Armenia in the coming months, potentially leading to the conclusion of the refinancing rate reduction cycle as early as the first quarter of 2025.
According to the EDB’s weekly macroeconomic review, inflation in Armenia reached 1.5% year-on-year in December 2024, showing a slight increase from November’s rate of 1.4%. Notably, food prices saw a sharper rise, climbing from 1.7% to 2% year-on-year.
In the services sector, price growth slowed slightly from 3% to 2.5% year-on-year, while disinflation in the non-food segment also decelerated, with the rate falling from 2.1% to 1.8%.
Since June 2023, the Central Bank of Armenia has steadily reduced the refinancing rate, implementing 13 cuts during this period, bringing the rate down from 10.5% to the current 7%. However, EADB analysts suggest this cycle may conclude in the first quarter of 2025.
As outlined in Armenia’s 2025 state budget, the inflation target is set at 3%, with a potential deviation of one percentage point in either direction. Meanwhile, the Central Bank projects inflation to reach 3.2–3.9% by the end of 2025, rise to 3.8–4.2% in 2026, and stabilize at around 4% by 2027.
