Central Bank of Azerbaijan defend banking sector from negative exterior impacts: General Director
Azerbaijan, Baku, Dec. 21 / Trend N.Ismayilova /
The Central Bank of Azerbaijan (CBA) will continue all necessary actions to support financial stability in the country, CBA General Director Khaqani Abdullayev said at the conference "Global financial crisis: the Azerbaijani safety effectiveness model and world experience International" held in Baku.
According to Abdullayev, in accordance with the legislation, the CBA will represent statement on monetary and credit policy's main directions to public in 2010.
The CBA summarizes the work. Soon the statement will be published.
"The CBA aims at saving financial stability in 2010, since the global financial crisis has not completed and world financial markets have not stabilized yet. In this condition the shock flowing from abroad may influence the Azerbaijani banking sector," Abdullayev said
According to Abdullayev, CBA monitors and tests the probability of a negative impact on the country's banking sector as a result of such processes
"We will support the real sector and maintain the liquidity of banking sector in 2010 as we did in 2009, Abdullayev said
The primary mandate for the central bank is to maintain macroeconomic stability in the country within its authority, he added
"The average annual inflation has been set at three percent in the draft 2010 public budget during the discussions, and the CBA aims to maintain this inflation ratio. This forecast could change if economic growth in the country exceeds expectations, and if aggregate demand channels will be expanded more rapidly due to the increase of individual consumption, investment and state demand. The inflation forecast may be revised in the country in such economic situation," Abdullayev said
According to Abdullayev, the CBA intends to monitor the preservation of competitiveness in the country in 2010
"Some economists supported the devaluation of national currency this year. They believed this can be a factor strengthening competitiveness. However, researches show if higher inflation occurs after the devaluation, it could further hurt competitiveness in the country," Abdullayev said
According to Abdullayev, presently the most generalized index of competitiveness for the country is a real-effective exchange rate of manat as compared to Azerbaijani trade partners' currencies, which is changing in favor of Azerbaijan
"This figure has decreased by sixth percent compared to currency of three trade partners since early 2009. In 2010, we intend to support this process at least at a neutral level," Abdullayev said.
The CBA will pursue a policy on decreasing interest rates by banks and maintaining the stability of national currency, he added
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