Lilia Amirkhanyan: Large inflow of foreign currency, dram appreciation lead to inflation

The sharp increase in foreign currency inflow in our economy is not due to the export of one kind or sector, and not due to the growth of exports only, Lilia Amirkhanyan, expert of the Hayatsk analytical center, told Alpha News.

“The sharp increase in foreign currency inflow in our economy is not due to the export of one kind or sector, and not due to the growth of exports only. The cause of the implemented monetary policy is the dram appreciation, observed by CBA in 2022.

Thus, certain non-economic processes caused the reduction in foreign exchange and demand. To put it differently, the supply increased due to the inflow, a certain reduction was observed, for example, due to the fact of paying for the same gas,” Amirkhanyan said.

According to the expert, the same monetary policy was one of the most important causes of the dram appreciation.

“It is accepted to compare the economy with the human organism. Economy is a breathing organism that can get sick. It would be a bit incorrect to call what is happening in our economy a Dutch disease.

The situation is interesting because if we consider it from the point of view of causes, we are not dealing with the Dutch disease in this case, but from the point of view of results, there are many similarities. The Dutch disease is related to specific sectors such as oil and gas sector. We are talking about the consequences of the boom in the export of those sources of energy,” Lilia Amirkhanyan explained.

According to her, there is a large inflow of foreign currency as well as the dram appreciation, which leads to inflation.