Jafar Ibrahimli: Central Bank gives message to market by keeping interest rate stable

Baku. 2 May. REPORT.AZ/ “Decision on keeping interest rate unchanged taken in yesterday’s meeting of Central Bank of Azerbaijan (CBA) is a message to the market.”

The analyst of Kapital Management investment company Jafar Ibrahimli told Report.

According to him, by doing this the Central Bank put an end to expectations for increase of interest rate in near future and brought to the attention of commercial banks that the situation related to manat’s exchange rate has been stabilized: “Because of uncertainty related to exchange rate some banks suspended loaning and don’t hurry to resume it. Because they think that the interest rate can rise up to 20-25%. In such case annual rate for loans can be even higher. Maintained interest rate crossed out these expectations of credit institutions”.

Moreover, J.Ibrahimli told that average interest rate for deals concluded as a result of yesterday’s deposit auction was 13%. This is another message to the banks: “Decrease of income of deposits placed in CBA means that the institution doesn’t want to pay high dividends for funds attracted from the banks. Banks have to look for alternative investment options, mainly considering to release loans”.