One of lowest inflation rates in region expected in Azerbaijan - ADB

Baku, Azerbaijan, Sept. 22

By Azad Hasanli - Trend:

The Asian Development Bank forecasts one of the lowest rates of inflation in Central Asia in Azerbaijan, said the updated Asian Development Outlook report of the ADB.

Previous report was released in March 2015.

Thus, inflation will amount to 6 percent in 2015 and 5.5 percent in 2016, according to the bank's forecasts.

To limit inflation, the central bank has reduced local currency liquidity, said the report. With tepid domestic demand largely offsetting price pressures from the devaluation, year-on-year inflation rose to only 3.5 percent in the first half of 2015, which was nevertheless up from 1.6 percent for the same period in 2014. The devaluation will continue to put inflationary pressure on imports other than food.

The ADB analysts said that the average inflation rate in Central Asia, where the bank traditionally includes Azerbaijan, is expected to reach 8.1 percent in 2015 and 7.5 percent in 2016.

"Price control [over production], established after devaluation in the countries of Central Asia in 2014 and 2015, has helped to keep inflation from accelerating," the report said.

The experts of the bank went on to add that the growth rate of inflation in Central Asia in the next year from 6.6 percent to 7.5 percent is mainly due to the increase in the inflation rate in Kazakhstan from 6.2 percent to 7.9 percent.

On the countries of Central Asia, the ADB inflation forecast is as follows:

ADB was founded in 1966 and has 67 members. The bank's headquarters is located in Manila, the capital of the Philippines. Azerbaijan became ADB member on December 22, 1999. The country's share in the bank's capital is 0.5 percent.

ADB's leading shareholders are Japan and the United States (31.2 percent of the total share capital), India and China (12.8 percent), Australia, South Korea and Canada (16 percent) and so on.

Edited by CN