Investment Review №356. A Reassessment of Values

Telecom Armenia: Post-IPO Stock Performance

Acba Bank: 1-Year Stock Performance

USD/AMD: 1-Year Performance

3-Year Corporate Bond Index (AMD), Post-Update

Armenian financial assets delivered mixed performance between October 5 and 19, 2026. Acba Bank gained 0.9%, bringing its YTD return to 32.7%, while Telecom Armenia (AMTL) slipped 0.2% but remained up 7.3% YTD.

The 3-Year Corporate Bond Index gained 0.2%, while the Armenian dram strengthened 0.2% against the U.S. dollar.

No major macro data was released, and news flow was driven by updated forecasts from international organizations, government statements, and a report by EAEU (Eurasian Economic Union) member states assessing the potential consequences of Armenia’s decision to suspend its participation. In our base case, we expect a limited drag on GDP growth and a mild pickup in inflation. Under a shock scenario, we would expect a gradual recovery as trade flows adjust.

Economic Updates

From October 5 through 19, 2026, investors focused on EBRD and IMF forecasts and on a report by EAEU member states assessing the potential implications of Armenia’s decision to suspend its participation in the EAEU.

• The EBRD raised its 2026 inflation forecast for Armenia to 4.4% YoY, above the Central Bank's 3% target and its ±1pp tolerance band. At the start of the year, it projected 3.3%.
• The IMF raised its 2026 GDP growth forecast for Armenia to 5.5% from 5.3% in April, while leaving its 2027 projection unchanged at 5.5%. Our estimate falls between the previously cited forecasts from S&P (4.9%) and the EDB (6.0%). The IMF expects inflation at 4.6% in 2026, easing to 3.6% in 2027.
• EAEU member states estimate that Armenia's GDP could contract by 15.6% under a scenario involving the suspension of its participation in the bloc. A report prepared by representatives of Russia, Belarus, Kazakhstan and Kyrgyzstan for the December Supreme Eurasian Economic Council meeting projects inflation 14.9pp above the baseline, a 55.6% drop in trade with the EAEU, roughly a 69% rise in the price of Russian gas (to an indicative $300 per 1,000 m³), and remittances from EAEU countries falling by more than half. We view this scenario as unlikely. In the near term, inflation could quicken and GDP growth could slow; over the medium to long term, we expect economic activity to normalize as trade flows are redirected.

Corporate News

• Armenia has brought the Amulsar gold mine into operation. Economy Minister Gevorg Papoyan expects the mine to contribute 1.5–2.0% of GDP, significantly boost exports and generate up to $130m in tax revenue in 2027 at current prices. Total investment exceeds $750m, with operations expected through 2039.

Two-Week Outlook

A series of September macroeconomic releases is scheduled for October 23–November 2, 2026, including economic activity data, the trade balance, and the producer price index (PPI). The Economic Activity Index will be the main focus. August growth stood at 5.2% YoY, and investors will assess whether September's reading is consistent with updated 2026 growth forecasts. For trade, attention will center on import and export trends after the deficit narrowed from July’s record high. For PPI, the August reading provides the benchmark: up 8.9% YoY but down 0.2% MoM.