IMF praises Armenian Central Bank’s tough monetary policy

Arminfo
22 Nov 04

Yerevan, 22 November: The International Monetary Fund accepts and
completely supports the tough monetary and credit policy of the
Armenian Central Bank to contain the inflation rate in the country,
James McHugh, the IMF’s resident representative in Armenia, has told
Arminfo news agency.

He said that over the past several months experts of the fund and
the Central Bank had expressed justified concern about inflationary
tendencies and, therefore, the Central Bank’s decision to toughen
its policy proved to be well-founded and effective.

McHugh said that for now a very rapid growth in economic productivity
was being observed in Armenia and in connection with this the
process of strengthening the national currency, the dram, becomes
inevitable. He agreed that the consolidation of the dram is causing a
rise in the price of Armenian exports, but this process is nullified by
the growth in productivity, which also threatens inflation forecasts.

Analysing the nose-dive in the rate of the dollar in the country in
August-September, the IMF representative noted that it was hard to
forecast a sharp fluctuation in the exchange rate, all the more so
in the current situation on the global financial markets.

[Passage omitted: McHugh is happy about the policy of the Central Bank]

From: Emil Lazarian | Ararat NewsPress