In June, the growth rate of the economic activity index in Armenia decreased by half, reaching 6.8 percent in real terms, compared to 13.6 percent in May, according to an analysis of the World Bank.
The aforementioned was mainly due to the slowdown in the growth rate of non-commercial services, which reached 4 percent in June compared to 12.3 percent in May; this was due to a high base effect, as growth was 36 percent in June 2022.
A reduction in industrial output in Armenia is one of the reasons for the slowdown, due mainly to a 15.6-percent decline in output from the mining sector.
But the construction and trade sectors continued to grow steadily at 18 and 20 percent, respectively. In the first quarter of 2023, the total growth reached 11.4 percent; the growth rate was the highest in trade (23.6 percent) and the lowest in industry (1 percent).
In the first quarter of this year, a 2-percent increase was recorded in Armenia’s agricultural sector, which is due to the recovery of the horticultural sector, while the output of animal husbandry and fish farming reduced.
In June, net remittances from Russia to Armenia were 33 percent less than in June 2022, but three times higher than in June 2021. In net terms, remittances in June 2023 amounted to USD 130 million, which is 2.7 times higher than in May, but 15 percent lower than the average of the past five months. Considerable fluctuations are observed in the inflows and outflows of remittances.
The decrease in the overall index of consumer prices in Armenia was mainly due to the decrease in the prices of food (3.9 percent), transport (1.7 percent), and communication (0.5 percent). The sharp decline in inflation was due to low external inflationary pressures, tight monetary policy, continued strengthening of the Armenian national currency, the dram, and a number of base effects. At its board meeting on August 1, the Central Bank of Armenia lowered the refinancing rate by 2.5 basis points—to 10.25 percent.
Source : News.am