Baku, Azerbaijan, Nov. 14
By Anvar Mammadov – Trend:
The Central Bank of Azerbaijan (CBA) may slightly reduce the discount rate during the further discussion of the interest corridor parameters at the board meeting, Azerbaijani expert in economic affairs Farhad Amirbayov said.
The expert said that the CBA’s decision will mainly depend on the impact of import operations and an increase in tariffs on inflation.
"At present, the CBA’s main goal is to fight high inflation,” he said. “Frankly speaking, today high inflation has mainly non-monetary reasons. It is formed due to external influence, in particular imports and an increase in tariffs for fuel and utilities. Influence of such factors on inflation is usually temporary and this effect is gradually disappearing.”
According to the Azerbaijani State Statistics Committee, the average annual inflation rate reached 13.7 percent in the country for 10 months.
At present, a high discount rate slightly impacts on the country's money market, the expert added.
"In fact, only a few banks are refinanced at the discount rate,” he said. “The economy, in a broad sense, is not affected by refinancing. So, the CBA's high discount rate slightly impacts the country's money market and is felt only at a high rate for bank loans."
The CBA has recently changed the discount rate on September 14, 2016, when it was increased from 9.5 percent to 15 percent. The next meeting of the CBA's board dedicated to the discount rate will be held on November 15.
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