Central Bank of Armenia Governor Martin Galstyan said lending rates in the country may rise if the monetary policy tightening cycle continues.
He made the remarks at a Tuesday press conference while answering a question about the possible impact of the Central Bank Board’s decision earlier that day to raise the policy rate by 0.25 percentage points to 6.75%.
Galstyan noted that the Central Bank’s rate-cutting cycle began in August 2023, when the regulator lowered the rate from 10.75% to 10.5%. The rate was then gradually reduced, reaching 6.5% in December 2025, and remained at that level afterward. The September 15 move was the first rate increase since December 2022.
“If the cycle continues and we see that what is happening is not a temporary phenomenon but a trend, then yes, a higher level of interest rates should be expected in the Republic of Armenia, as in almost all countries of the world,” Galstyan said.
At the same time, he stressed that a policy rate increase does not automatically mean an immediate rise in bank lending rates. According to him, transmission mechanisms work with a time lag in different countries depending on accompanying factors, so the effect may be felt either quickly or more slowly.
Official statistics show that the interest rate on commercial banks’ lending transactions stood at 12.51% in July, compared with 13.18% in June.
