National Bank of Azerbaijan Re-considers Rates of Financing

Business Materials 10 April 2008 17:26

Azerbaijan, Baku, 10 April /corr. Trend I.Khalilova / On 10 April, the Board of National Bank of Azerbaijan made a decision to increase the rate from 13% to 14% in order to strengthen the control on the monetary factor affecting the growth of inflation in Azerbaijan, a source at the NBA stated. According to the decision, the minimal range of the 'interest corridor' was decreased from 5% to 3% and maximal range was increased from 19% to 20%.

This step will give an opportunity to maintain the credit expansion at an available level, reduce potential threats in the financial sector, and support development of the inter-bank money market.

Introducing the new approach of 'interest rate' and changing rates aims to limit excessive money proposals and decrease the inflation. The NBA will continue the monitoring on the monetary and non-monetary factors and will consider changing the rates as per the necessity.

Applying the 'interest rate' on the NBA operations and increasing the rates created impacts of disinflation in the Country. The NBA considers it necessary to continue strong interest policy in order to strengthen the disinflation process by increasing norms of collection and limiting aggregate expenses.

The current official rate of the National Bank of Azerbaijan totals 0.83 AZN/USD.

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