According to the recently published World Bank report, "Armenia Monthly Economic Update – September 2024," the Armenian dram demonstrated relative stability against the US dollar and the Russian ruble from June to August of this year.
The report states that by the end of August, the dram had depreciated by only 0.5% against the US dollar compared to 2023, while it depreciated by 6.2% against the Russian ruble. To smooth out currency fluctuations, the Central Bank of Armenia purchased $256.5 million in the second quarter of 2024.
The country’s international reserves continued to grow, increasing by $260 million in July-August and reaching $3.6 billion, equivalent to three months of import coverage. However, this figure is still 13% below the reserve levels at the end of July 2023.
In July, a budget deficit of approximately $177 million was recorded, mainly due to increased spending. Total expenditures rose by 24.4% year-on-year, driven primarily by a 19.6% increase in current spending. Capital expenditures also grew by 43.6%, largely due to improvements in defense and road infrastructure.
Tax revenues in July nominally increased by 14.6% compared to the previous year. However, after accounting for income tax refunds related to mortgages, the overall growth in tax revenues amounted to just 2.3%.
Collections from turnover taxes and excise duties, the main sources of tax revenue, increased by 15.6% and 12.4%, respectively. Meanwhile, VAT collections remained unchanged.
For the January-July period, the budget showed a deficit of approximately $149,000 (0.6% of the projected annual GDP), in contrast to a surplus of around $247 million for the same period in 2023.
