The Central Bank of Armenia (CBA) will announce its decision on the refinancing rate Tuesday. CBA governor Martin Galstyan said this during Monday’s special meeting of the National Assembly Standing Committee on Financial-Credit and Budgetary Affairs.

"Today is a day of silence for us so as not to give unnecessary impulses to market participants and society. Tomorrow will be our decision. We have reached a very important critical point. After having two years of high inflation, we [i.e. Armenia] now have an inflation that is below the target, which is mainly due to the depreciation of the food products being imported [to Armenia]," stated the CBA chief.

According to him, especially in Armenia’s service sector, where there has been no inflation for decades, now there is inflation. And the reason, according to Galstyan, is the increase in demand.

"And as you know, the main goal of the Central Bank is demand management. In this case, we see that the inflation indicator is 4 percent; the 12-month inflation in May is 1.3 percent. Along with such encouraging indicators, we see that by raising the interest rate, the demand has been restrained. But on the other hand, there is excess demand in the economy [of Armenia]," added Galstyan.

As per the CBA governor, it turns out that Armenia’s economic growth and demand continue to be higher than the country’s potential.