Inflation Increase Rates May be Specified as a Result of Nine Months

Business Materials 20 August 2008 14:47 (UTC +04:00)

Azerbaijan, Baku, 20 August /corr. Trend I.Khalilova / Ministry of Economic Development of Azerbaijan refuses to forecast inflation increase for the end of 2008.

"The growth rates in the inflation in Azerbaijan because of the summer season reduce as compared to other countries. If the index of inflation in Azerbaijan is not compared with the level of consumer prices 4-6 years years ago, then in other countries the discussions deal with the period of 30 years ago," said the Minister of Economic Development of the Country, Heydar Babayev.

He considers that only as a result of nine months it will be possible to forecast inflation for the end of the year. At the same time, he thinks that the forecasts of the Ministry, which were formed on the basis of tendencies, were correct. Expectations on inflation for 2008 were determined at the level of 13-14%.

However, today the growth rates of inflation in Azerbaijan practically approached the forecasts of the International Monetary Fund (22%) and as a result of seven months, were 20.9%.

The Head of State Statistics Committee, Arif Valiyev, considers that by the end of 2008, the index of inflation will change with small difference. In his opinion, it will serve reduction in the inflation if in July or August deflation will be observed. For the first time, in the summer season reduction in the prices of food products was observed, which was at the level of 1.4%, but price increase continued for nonfood products and service - to 0.6% and 1.5% respectively.

The Anti-Monopoly Service periodically conducts monitoring in order not to allow an artificial price increase, origin of monopoly, which is part of anti-inflation measures. If products is imported, then government can not require entrepreneurs to sell products below prime cost because the prices for these goods are formed at the World Markets. The National Bank of Azerbaijan, in turn, holds control on inflation by strengthening AZN.

Inflation growth rate in 2007 made up 19.7%.

Official exchange rate on 20 August was 0.8138 AZN/USD.

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