BAKU, Azerbaijan, April 9. The International Monetary Fund (IMF) predicts that Azerbaijan's economic growth will keep its nose to the grindstone in 2025, with inflation staying well within the sweet spot set by the Central Bank of Azerbaijan (CBA), Trend reports, citing the IMF's predictions.
According to the IMF, inflation is set to take a backseat, staying within the CBA's sweet spot of four percent, give or take two. This is thanks to steady international food and energy prices, along with a tight ship on fiscal matters.
The IMF projects that the country's economy will expand by 2.5 percent in the medium term. However, it anticipates a weakening of Azerbaijan's external position, driven by reduced hydrocarbon production and prices, leading to a decrease in the trade surplus and non-hydrocarbon exports. Despite these challenges, the country's foreign exchange reserves are expected to remain strong.
"The impact of investments will decrease, hydrocarbon production will decline, and as the production gap narrows by 2026, growth is expected to slow to 3.5 percent in 2025," the report reads.
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