In the period from January to June 2025, Armenia’s consumer market has demonstrated a number of contradictory trends, whose in-depth analysis reveals certain structural issues in the economy. The overall Consumer Price Index (CPI) stood at 3.9%, indicating moderate inflation. However, behind this figure lie sharp fluctuations among commodity groups and sector-specific pressures, especially in the areas of food and transportation.
Food prices showed a significant year-on-year increase of 6.2%. In June 2025, compared to June 2024, prices rose by 3.9% for bread, 7.1% for flour, and 5.3% for pasta. Compared to May 2025, the increases were 0.2%, 0.8%, and 1.3% respectively. The price of beef rose by 1.2% compared to June 2024, lamb and pork prices rose by 3.9% and 4.5%, while compared to May 2025, the increases were 0.2%, 2.2%, and 3.3% respectively. The price of cheese dropped by 1.6% year-on-year but rose by 0.2% compared to May.
The prices of margarine and butter increased by 1.1% and 14.0% respectively compared to June 2024, and by 0.6% and 0.7% respectively compared to May 2025. The price of sunflower oil increased by 17.5% year-on-year and by 1.4% compared to May. Sugar and related products decreased by 2.8% compared to June 2024, but showed a 0.8% increase compared to May. The price of ice cream increased by 5.2% year-on-year, coffee by 14.3%, chocolate by 14.8%, and cocoa by 20.4%; compared to May, the increases were 1.1%, 0.6%, 2.6%, and 0.4% respectively. The price of fresh milk rose by 0.8%, rice by 0.9%, and “Ishkhan” fish by 21.8% compared to June 2024.
Alcoholic beverages and tobacco products saw a price increase of 4.5% and 7.4% respectively year-on-year, and 0.3% and 0.7% compared to May 2025.
This is where economics becomes social policy. Food and tobacco belong to the group of immediate consumption goods, and price increases in these categories primarily affect low- and middle-income households.
Notably, food prices decreased in June compared to May, which on one hand contradicts the general trends of the year, and on the other hand, points to underlying problems. Thus, in June 2025, prices decreased by 1.3% compared to the previous month. However, this figure is largely explained by the reverse dynamics of specific commodity groups — particularly a 23.6% drop in vegetable prices and a 1.2% drop in fruit prices. Together, these two groups contributed to a decrease in the overall CPI by about 1.25 percentage points, having a combined weight of 8.28% in the consumer basket. Still, it is important to note that this decline is seasonal and cannot be regarded as a result of structural economic improvement. Moreover, such sharp fluctuations reflect the vulnerability of the domestic market and issues related to planning in agricultural production.
Transportation services experienced a notable price increase — 26.8% year-on-year and 11.6% month-on-month. Their contribution to overall CPI inflation amounted to 0.45 percentage points, highlighting the sector’s significant role in forming the aggregate index. This price surge is largely due to the government’s ongoing transport reform program. At the same time, prices for gasoline and diesel fuel fell by 7.6% and 10.9% respectively year-on-year.
Price increases in healthcare and education services — 3.6% and 7.8% respectively — reflect trends in socially sensitive sectors, where rising costs are not only an economic concern but also a challenge to the accessibility of quality of life.
In the case of pharmaceutical products, a 4.3% price increase, along with a 4.0% rise in the cost of medical equipment, indicate that the healthcare system is operating at the edge of its capacity, facing significant pressure.
Thus, the recorded moderate inflation was largely driven by seasonal decreases in fruit and vegetable prices, the downward price trend in the non-food market (–0.2%), and low or marginal increases in some services — including communication, restaurants, and hotels, which recorded changes ranging from 0.2% to 0.7%.
These counterbalances, however, do not eliminate the macroeconomic vulnerabilities, as high inflation remains concentrated in socially sensitive areas.