CBA keeps interest rate unchanged

Baku. 26 December. REPORT.AZ/ Management Board of the Central Bank of Azerbaijan (CBA) has made a decision to keep the parameters of interest corridor unchanged.

CBA told Report that the interest rate was set at 9.75%, upper limit of interest corridor at 11.75%, lower limit at 7.75% (±2 diapason). The decision will come into force from 2:00 p.m. (GMT +4) on December 26, 2018.

According to the bank, the average annual inflation is expected to remain unchanged: "The inflation in eleven months of 2018 was 2.3%, which is lower than target interval. Affected by seasonal factors, food inflation has slightly increased. However, non-food products and low-rate price change of paid services, as well as monetary factors neutralized this growth. Consequently, the monthly inflation stood at 0.6%. According to latest forecasts, the inflation is expected to be around 2.8% as at the end of 2018’.

Positive balance of foreign trade turnover amounted to 18% of GDP. In the reporting period, the non-oil exports grew by 11%, non-oil imports by 33%.

Economic growth in the eleven months of 2018 was 1%. The growth in non-oil sector made 1.4%, in non-oil industry 8.7%, in agriculture 4.6%.

CBA says existing parameters of the interest corridor create grounds for population’s anti-inflation behavior by supporting charges in national currency: "On the other hand, extension of money supply supports economic activity without damaging macroeconomic stability. In the reporting period, the money supply increased by 13.3%."