The CBA also increased note issuance in June by 23 percent (mom), in order to reduce AZN liquidity, Report informs, citing World Bank's July economic update on Azerbaijan.
"The Bank kept the policy rate at 7.75 percent amid rising inflation, stating that the decision was backed a large current account balance (CAB) surplus (22.5 percent of GDP) in Q1 2022, supporting the use of the exchange rate as a nominal anchor," the review says.
According to the review, CPI inflation rose by 0.7 percent (mom) in May, bringing annual inflation to 13.7 percent. Food prices rose by 0.7 percent in May, with annual food inflation reaching 20.1 percent. Service inflation rose by 0.5 percent in May while annual service inflation stabilized at 10.3 percent.
During January-May 2022, the agriculture Producer Price Index (PPI) rose by 16.7 percent compared to the same period of the previous year, while the non-energy non-oil manufacturing PPI picked up by 20 percent, affected by imported inflation.