YEREVAN, May 16. /ARKA/. Armenia’s Central Bank decided at a meeting today to keep the refinancing rate unchanged at 6%, the regulator's press service reported. The regulator said the 1.0% inflation recorded in 2017 April (against the 0.3% deflation a year ago) was driven by higher prices for agricultural products. As a result the 12-month inflation was 1.2%, exceeding its forecast.

The Central Bank said also it believes that inflation will continue to recover in the coming months to stabilize around the projected target.

‘Although growth prospects of the world economy are improving, and inflationary developments persist on international commodity markets, the central bank, nevertheless, expects only a moderate inflationary impact in the coming months from the external segment,’ it said.

The regulator explained the fairly high growth of economic activity in the first quarter of this year by high growth in industry, services and trade.

At the same time, the stimulating monetary and credit policy implemented in recent years continues to contribute to the restoration of domestic demand. Estimating that the inflation risks at the moment are balanced, the central bank considered it expedient to leave the monetary and credit conditions unchanged.

In an interview with Reuters in March, Armenia's Central Bank chairman Artur Javadyan signalled a halt to the easing cycle, saying the bank would now be more cautious in deciding whether to cut rates because of potential economic and financial risks. In 2016 alone the rate was lowered 8 times. -0-