The consumer price index does not yet “want to fit in” with the 4%±1.5% budgeted by the RA Government for 2010.

Unfortunately, the consumer price index, which reached 8.4% this January-March actually exceeds the highest budgeted index by 2.9%. Inflation has been rising over the months, which is evidence of certain trends.

One can hardly hope for stabilization of prices in the near future. On April 1, 2010, the price for one of the major price-forming products, natural gas, was sharply raised. Officials’ optimistic forecasts that the rise will not seriously influence the prices for other goods and services will hardly come true. Even before the gas price was raised, a 13.2% rise in the average price for a tankful of liquefied gas for a car was registered.

Most passenger vehicles and fright carriers are operating on condensed gas in Armenia. So carriers may revise their prices as well. This January-March, a sharp rise for other types of motor fuel was registered as well.

Specifically, the price of one liter of petrol rose by 40.4%, and that for diesel fuel by 27.8%. This January-March, consumer prices showed a 7.5% rise as compared with the corresponding period last year. Clothing and footwear set a record – a 10.1% rise. Food products (without alcoholic beverages and tobacco) showed a price rise of 5.7%. As regards alcoholic beverages and tobacco, the price rise was “as modest as” 1.4%.

The price for superior quality bread rose by only 0.3%, with the grain price registering a 19% fall. One can only guess at the phenomenon.

An 18.2% rise in the beef price, and a 70.9% rise in the mutton price are striking evidence of unfavorable trends in the livestock sector and the Government’s blunders. As regards the 13.3% fall in the price for pork, it can be accounted for a recent outbreak of African plague in some Armenian regions, which affected the consumer demand.

The index of prices for paid services showed a general rise of 10.4% as compared with last January-March. Specifically, personal services and medical services showed a13.6% and an 8% rise respectively. The prices for intercity transport services showed a 20.7% rise.

Thus, the cost of living considerably increased in Armenia in the first quarter of this year, and the April 1 rise in the gas price will inevitably cause a new price rise. Under the circumstances, the price for the most essential food product, bread, can be expected to rise, which will prove a real disaster for the socially vulnerable sections of Armenia’s population.

T.P.