YEREVAN (ARKA)—Economic activity in Armenia in third fiscal quarter grew at a rate higher than expected, driven primarily by supply factors, the Central Bank of Armenia said today.
According to the regulator, expansionary fiscal policy has contributed to some recovery in domestic demand, which has offset the deflationary environment to a certain extent.
“Supply and demand-related developments have led to an accelerated rate of net exports, which significantly improved the external balance of the country,” the Central Bank said in a statement.
The regulator said it also believes that these key economic indicators have substantially increased the country’s resilience to external shocks. Growth fluctuations in world financial and currency markets have created relatively high inflation expectations that did not allow forming of a lower inflation environment.
“In this situation, [the] Central Bank Board considers it appropriate to maintain the current monetary conditions, in which the 12-month inflation will decline by the end of the year and range near the lower target band. This monetary policy will allow to reduce and anchor inflation expectations in the future, and secure the medium term inflation target,” it said.
According to the National Statistical Service, economic activity in the first 8 months of 2015 was 3.9%, driven largely by growth in agriculture and services.