Will There Be Double-Digit Food Inflation This Year? 'Pasta'

'Pasta' newspaper writes that the panic buying trend that started in stores days ago seems to have passed, as people no longer stock up on months' worth of supplies. Instead, serious inflation is being recorded on a daily basis, rapidly draining the wallets of our citizens.

Economist Suren Parsyan, in an interview with 'Pasta', notes that the Armenian consumer will not face a food deficit but will have to pay significantly more for food, as prices continue to rise on the global market. According to the economist, this year we will experience double-digit food inflation, with the foundations already in place. 'In January-February, a 6.5% inflation rate was recorded, while food prices increased by 11.8%. The inflationary situation from last year has carried over into this year, compounded by the factors of the Russian-Ukrainian conflict, which will lead to an increase in food prices on the global market,' says Parsyan, emphasizing that we have a high dependency on imports, and the devaluation of the dram consequently leads to higher prices for imported goods.

In Armenia, almost always, and now even more so, a devaluation of the dram immediately results in inflation, while there hasn't been a corresponding drop in prices when the dram appreciates. Parsyan cites the first reason as importers' concerns that the dollar exchange rate may sharply rise again: 'Secondly, they create financial cushions for themselves to protect against such fluctuations. Another reason we do not see price drops are the monopolies characteristic of our market and their policies. Large importers dictate prices in the market; there is no competition to force them to lower prices,' says the economist.

For more details, see today's issue of the newspaper.