YEREVAN, October 17. / ARKA /. High inflation is wiping out Armenian pay rises hurting also people’s bank savings.

According to the National Statistical Service, the 12-month inflation in August rose to 9.3 % from the year before and although the Central Bank raised the refinancing rate from 8 percent to 8.5 percent in a bid to curb inflation, the rise in prices continues to negatively affect the level of incomes.

According to official data, the average gross salary in August 2013 increased by 5.1 % year-on-year to 149,725 drams ($368), but the inflation has actually wiped out the growth. In reality in reality the salaries decline by 4.2 %.

A similar trend was observed not only in August. For example, in July the wages rose by 5.5 %, but with an inflation of 8.5 %, the median salary actually declined by 3%. The same trend was observed in the previous months.

The situation was somewhat different in April, February and January when the wage growth was a little higher than the inflation rate.

According to the Central Bank, the average interest rate on deposits in August was 9.3 %. As a result, the real average rate of returns on deposits in view of the August inflation ranged from minus 0.9 % to plus 0.9 %.

It is noteworthy that even in these circumstances, the banks managed to not only attract new deposits from the citizens. Thus, according to the Central Bank, deposits of residents in August this year rose by 21.6 % from the year before to 1. 054.1 trillion drams, of which 726.4 billion were household deposits (an increase of 24.9 %).

The experts believe that the burden of inflationary pressures will be felt stronger in the last months of the year, and in the first quarter of 2014, driven by higher prices of natural gas and electricity, which came into force in July.

At the same time, the Central Bank of Armenia Board believes that the inflation will be decreasing to approach to the projected target. In September, the 12-month inflation declined to 8.2%. The government inflation projection for this year is 4 % (± 1,5%). ( $ 1-406. 38 drams). -0-