Analysts from the Eurasian Development Bank (EDB) have identified key factors influencing price dynamics in Armenia.
According to the weekly macroeconomic review by the EDB, a significant role is played by the decrease in the cost of imported food products against the backdrop of declining prices in global markets, the strengthening of the local currency, and the impact of tight monetary conditions.
In April of the current year, consumer prices in Armenia decreased by 0.7% compared to April of the previous year, following a 1.2% decrease in the previous month. The main contribution to deflation was made by the segment of food products, where prices decreased by 4.5% year-on-year after a decrease of 5.6% in the preceding month.
According to the data from the Statistical Committee, deflation in the consumer market was at 0.7% in April of the current year compared to the same period last year, while inflation at the level of 0.6% was recorded compared to March.
In the 2024 state budget, inflation is projected to be at 4% (±1.5%). According to the forecast by the Central Bank, inflation in Armenia is expected to be at 1.3% by the end of 2024. The projected inflation rates for 2025 are in the range of 4.6% to 4.1%, and for 2026 - from 4.7% to 4.1%.
Meanwhile, the IMF, as previously reported by BMG, predicts an acceleration of inflation in Armenia. The country is expected to experience accelerated consumption of goods and services, which, according to the IMF's forecasts, could lead to an inflation rise to 3.1% in 2024 (from 2% in 2023) and to 3.7% in 2025 if realized.
