BAKU, Azerbaijan, April 6. The World Bank (WB) expects inflation rate in Azerbaijan to stand at 8.5 percent in 2023, Trend reports, citing the WB's Europe and Central Asia Economic Update.
According to the report, this is a considerable decrease, compared to 13.8 percent estimated for 2022. However, this is still more than 6.7 percent in 2021.
"Inflation rose from 6.7 percent in 2021 to 13.8 percent by end-2022, driven by high import prices, particularly for food. To counter inflationary pressures, the Central Bank of Azerbaijan (CBA) raised the policy rate by 100 bps during 2022 to 8.25 percent. However, the policy rate remains negative in real terms. Inflation is projected to slow to 8.5 percent in 2023 as international prices ease, while remaining above the CBA’s upper range," the bank said.
At the same time, according to WB analysts, inflation rate in the country is projected to ease to 6.2 percent in 2024, and even further to 5.4 percent in 2025.
"Over the medium-term, inflation is expected to moderate and return to the CBA’s target interval of 4+/–2 percent by 2025," the report added.
Meanwhile, the WB expects Azerbaijan's GDP growth to stand at 2.2 percent in 2023, and then to recover to 2.5 percent in 2024, and 2.6 in 2025.