Կենտրոնական բանկ

The Board of the CBA raised the refinancing rate by 0,25%

In the April 7, 2009 meeting the Board of CBA decided to lower the Refinancing Rate of CBA by 0.25 pp to 7.50 percent.

Inflation in March was 1.4 percent, while the 12-month inflation had not changed in relation to the previous month, making up 1.0 percent.

The Board asserted that, despite the dram’s depreciation in March, inflation has been lower than projected, due to persisting external deflationary environment and declining domestic demand, which is attributable to reduced world demand. In the meantime, continuing considerable reduction in external demand, weakening financial inflow and persisting adverse terms of trade have reflected the acceleration of economic decline.

The Board believes that, given existing and expected macroeconomic developments, a prudent combination of the fulfillment of the inflation target and the stimulation of economic activity will suggest implementing an expansionary monetary policy. In this context, it is more advisable to exercise interest rate cuts in combination with quantitative easing.