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bne December 2022 Eurasia I 79
year. But since then, inflation has begun to fall moderately after a consistent series of rate hikes staring in December 2020 from 4.25% as the Armenian central bank was fast to react to the rising inflationary pressures. The latest hike was in October, bringing the prime rate to 10.5% and leav- ing the country with real interest rates of 1% and slightly ahead of the curve, unlike many countries in the region.
Yeritsyan says that Armenia has devel- oped a comprehensive framework that
includes strong forecasting analytics, as “we are not targeting today’s inflation but the forward rates.”
The Armenian central bank (CBA) was targeting inflation at under 2% in 2020, but like everyone else has had to reset its goals.
“We have had to react to the supply shocks and act to ensure that inflation remains anchored. In 2020 the CBA rates were 6.25% and rose to 10% in 2020. Now the goal is to reduce the rates and bring infla-
tion back down to 4%,” Yeritsyan said.
In March inflation peaked and began to fall again but disruptions in the market have caused a setback.
“The crisis has changed the way we work. The uncertainties mean we have switched to a risk-management modus without guidelines or benchmarks. We call it the F+ mark II, where we use forecasting and risk management policies to deal with the uncertainties.”
Putin's negotiations with Armenia and Azerbaijan don't bring any concrete results
Ani Mejlumyan in Yerevan, Cavid Aga in Baku
Armenian and Azerbaijani leaders pledged to "actively" work on a bilateral peace treaty but still need to iron out their differences on
its critical provisions, following talks hosted by Russian President Vladimir Putin on October 31.
According to Putin, the two-hour trilateral meeting with Armenian Prime Minister Nikol Pashinyan and Azerbai- jani President Ilham Aliyev was "very useful" because it created a "very good atmosphere for possible future agree- ments on some key issues".
However, the statement neither touches on the Nagorno-Karabakh conflict nor mentions any details about Armenian POWs, the Zangezur corridor etc.
"Today we agreed on a joint statement," he said after the meeting in Sochi. "I must say frankly that not everything was agreed upon. Some things had to be taken out of the text worked out beforehand at the level of experts," he added without elaborating.
In the statement, Aliyev and Pashinyan said they "agreed to refrain from the use of force or the threat of its use and dis- cuss and resolve all problematic issues solely on the basis of mutual recogni-
tion of sovereignty, territorial integrity and inviolability of borders".
"On the basis of existing proposals, it
was agreed to continue the search for mutually acceptable resolutions," said the statement. "The Russian Federation will render all possible assistance to this."
Putin signalled that 'unresolved issues' will not be publicly discussed: "It is not necessary to draw the attention of the press and the public to them, but just calmly seek agreement behind closed doors," he said later. "These are very subtle things, sensitive for both sides, and I do not consider myself entitled to stick out without the consent of my partners," Putin concluded.
"It is still premature to talk about the main components of the peace treaty, since this is still the subject of compro- mises which must be reached on both sides through mediation," Putin later said, answering the media's questions. "For our part, we always welcome any efforts aimed at a settlement. Therefore, as for how this correlates: it correlates quite naturally," he said, answering
a question about how does the EU- organised tripartite meeting in Prague compare with the tripartite summit in Sochi, "And we support everything that
is aimed at reducing confrontation and settlement."
During the Valdai Summit on October 27, Putin had made an inflammatory remark on the Western diplomatic offensive. "If the Armenian people and the current Armenian leadership consider it neces- sary to choose a version of the peace agreement, the so-called Washington variant, which as I understand envisages the recognition of Azerbaijan's sover- eignty over Karabakh as a whole, that
is if Armenia thinks that way – then go ahead," Russian President Vladimir Putin said on October 27. "We will support the choice of the Armenian people."
None of these plans is known, but so far, it is clear that Putin was unable to convince Aliyev to delay the status of the Karabakh issue, which is the most sensitive subject for the Armenian side.
The Russian Federation is ready to provide the most accurate maps of the Soviet General Staff to resolve the issue of demarcating the border between Armenia and Azerbaijan, Putin said. "We are ready to provide the maps at our disposal of the General Staff of the Soviet Army. These are the most accurate maps, as we understand. And we are ready to move on this base, discussing with both
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