Food prices in Armenia are rising uncomfortably high and the causes are not easy to fix: global inflation, a bad harvest, and economic depression brought on by pandemic and war.
Last month, compared to July 2020, the price vegetables increased by 53%. The Central Bank of Armenia (CBA) says core inflation was up 8.1% y/y in July, the highest figure seen since 2011. The CBA, the guarantor of price stability, targets 4%.
In an attempt to tame this higher-than-expected inflation, the CBA raised its benchmark refinancing rate on August 3 for the fifth time in less than eight months. In June, the bank explained that the global economic recovery was causing the prices of essential food imports to rise and expected this "high inflationary environment" to persist in the months ahead. That’s further stifling already weak demand.
