Fitch expects stability of Azerbaijani manat exchange rate in next 5 years

According to the forecast of Fitch Ratings, Azerbaijan will maintain a de facto peg of the national currency to the US dollar at 1.7 manat per dollar until at least the end of 2030, Report informs.

Maintaining a stable exchange rate is considered one of the key political priorities, despite the authorities’ announced plans to gradually expand currency flexibility in the medium term. The agency notes that the Central Bank of Azerbaijan continues to develop tools for managing the structural excess of liquidity in the banking system, and also strengthens the efficiency of the transmission mechanism of monetary policy.

Nevertheless, the impact of monetary decisions on the economy remains limited, Fitch analysts emphasize.

Among the restraining factors, they highlight underdeveloped domestic money markets, high liquidity in the banking sector, as well as a significant level of dollarization. As of April 2025, about 40% of bank deposits in the country remain denominated in foreign currency, despite the downward trend, the agency emphasizes.

The manat exchange rate at 1.7 per dollar was fixed by the Central Bank in 2017 in order to curb inflation and stabilize the macroeconomic situation.

In addition to Fitch, analysts from the Dutch bank ING and the Asian Development Bank also expect the manat to be pegged to the dollar until 2026.

In turn, Azerbaijan's Economy Ministry and the international rating agency S&P Global Ratings predict that the current fixed exchange rate regime will remain in place at least until the end of 2028.