YEREVAN, August 16. /ARKA/. Armenia's Central Bank said today it decided to keep the refinancing rate unchanged at 6%. It said the 12-month inflation as of July 1 was 1.1%, by 0.3 percentage points more than projected by the regulator. In July, a deflation of 2.6% was recorded, caused by a seasonal decline in prices of agricultural products, as a result of which the 12-month inflation fell slightly to 0.9% at the end of the month.

According to the Central Bank, the prospects for improved growth of the world economy persist, with prices in international commodity markets showing a stabilization trend. Based on this, the Central Bank does not expect a significant impact of inflation from the external sector in the coming months.

The Central Bank noted also that the figures for the second quarter suggest an ongoing high economic activity and domestic demand recovery rate, aided in the context of a restrained fiscal policy by an expansionary monetary policy.

All this in view, the Central Bank decided to leave the refinancing rate unchanged, as a result of which the inflation is expected to gradually increase at the end of 2017 around the projected band. The Central Bank believes that if macroeconomic developments occur according to the forecasted scenario, monetary conditions will remain stimulating for some time.

It said also in case of necessity it will l make appropriate adjustments in the monetary policy to ensure the target inflation for the medium-term period.

The Central Bank suspended monetary policy easing in March this year. During 2016 the refinancing rate was lowered 8 times. -0-