From June 17 to July 1, 2024, data on economic activity for May indicated some slowdown in growth, according to an economic digest from Freedom Broker Armenia.
Experts at Freedom Broker believe that the foreign trade turnover statistics showed export growth beginning to outpace import dynamics, as anticipated, suggesting a reduction in the trade balance deficit. “This could lead to some strengthening of the Armenian dram if the increase in exports continues,” the report states.
The report mentions that economic activity growth continued to slow in May, reaching +5.2% year-over-year (compared to +10.4% year-over-year in April), indicating a 2.0% month-over-month increase from the previous month, according to the country’s statistical committee.
“For the first five months of 2024, the growth rate was 11.2% year-over-year (compared to +13.2% for January–April). The slowdown in economic activity growth (which should impact GDP dynamics) was largely expected, considering that the annual GDP growth forecasts are lower than the figures at the beginning of 2024. On the other hand, this may have a slight restraining effect on domestic consumption and import dynamics,” noted the company's experts.
Previously, the Eurasian Development Bank (EDB) raised Armenia's economic growth forecast from 5.7% to 7.5% in 2024 but lowered the forecast for 2025 from 5.3% to 4.2%. The increase was made against the backdrop of high business activity due to the growth in processing and exporting gold products, as well as improved domestic demand. The EDB also predicts a reduction in the Central Bank of Armenia’s refinancing rate to 7.5% by the end of the year (compared to the current level of 8.0%).
