IMF does not expect Karabakh events to have impact on economic growth
Speaking at a news conference today in Yerevan, Hossein Samiei, International Monetary Fund (IMF) Mission Chief to Armenia, said the IMF does not expect a significant impact of the latest upsurge in violence in and around Nagorno-Karabakh on Armenia’s economic growth.
Mr. Samiei said the IMF did not have the opportunity to evaluate the economic implications of the violence since the fire cessation was agreed only on April 5. He said at this moment he did not expect these developments to have a big impact on economic growth.
Mr. Samiei expressed regret in connection with the growth of tension and loss of lives saying his hope is that peace would be restored.
‘We were glad to hear that a cessation of hostilities was reached and we hope that it will continue," he said.
He said the IMF and Armenia’s Central Bank agreed on the need for gradual easing of the monetary policy, describing the regulator’s latest decision to cut the refinancing rate by 2 percentage point as "very serious."
He also agreed that rates on loans are high, but added that monetary policy is not the only factor affecting the bank rates.
According to him, there are other risks associated with the uncertainty and when the economic environment improves and the level of uncertainty declines, then the difference between the refinancing rate and loan interest rates will reduce.
In March the Central Bank lowered the refinancing rate by 0.25 percentage points to 8.25%. It was the fifth cut since August 2015. -0-