Armenia’s inflation in first quarter of 2010 rose by 2.9%

Armenia’s inflation in first quarter of 2010 rose by 2.9%
ARKA, 16.06.2010

Armenia’s inflation in the first quarter of 2010 rose by 2.9% as the inflation rate for the 12 months rose by 2.3 percent to 8.8%, the Central Bank of Armenia said in its money and credit report for the first three months of the year.

According to the report, main macroeconomic developments in January-March were characterized by inflationary pressure and accelerated global and domestic economic recovery rate.

According to Central Bank experts, inflation was driven by high food and non-food prices at global markets, the impact of fiscal and credit and money expansionary policies as part of anti-crisis programs and negative expectations caused by devaluating national currency, the Dram.

The report says food prices, including tobacco products and beverages rose by 4.3% year-on-year, while non-food prices rose by 1.1% as services prices rose by 1.3% if compared to the first quarter of 2009 driving the overall inflation rate by 2.3, 0.2 и 0.4 percentage point respectively.

The price rise was conditioned mainly by the rise of prices of meat products by 9.2%, vegetables and fruits by 23%, health services by 2.9% that drove inflation rate up by 0.9, 1.1, 0.3 percentage points respectively.

‘The inflationary pressure impact was reflected also on normal inflation behavior that was 2.1% in the first quarter. As a result the 12-month inflation rate rose by 1.9 percentage point year-on-year to 7.1%,’ the report said. It also said that the gradually improving macroeconomic situation was responsible for 5.5% GDP growth in January-March against 6.1% decline in the first quarter of 2009.-0-