Baku, Azerbaijan, Dec. 26
By Taleh Mursagulov - Trend:
Average annual inflation rate in Azerbaijan is expected at 2.3 percent in 2018, Trend reports with reference to the message of the Central Bank of Azerbaijan (CBA) Dec. 26.
“Food inflation in November increased slightly due to seasonal factors,” the message said. “However, low rates of change in prices for non-food products and paid services, as well as monetary factors neutralized inflation growth. As a result, monthly inflation in November was 0.6 percent.”
The CBA message notes that the current dynamics of consumer prices and the stable exchange rate of Azerbaijani manat remain the main factors stabilizing inflation expectations.
At the same time, consistent decisions to mitigate the monetary policy this year led to a decrease in inflationary expectations of market entities, according to the message.
“Inflationary risks are balanced,” the bank said in the message. “A stable macroeconomic structure plays a major role as the main stabilizing factor. However, this balance is dynamic, and a number of external and internal processes may activate risk factors that increase inflation. External factors include price uncertainty the global oil market, fluctuations in the exchange rate of currencies of trading partners and the growth of inflation in these countries.”
The income tax reform, which comes into force next year, may also increase the income of the population and, along with supporting economic growth, activate the factor of demand inflation, according to the message.
The CBA already reduced its expectations for inflation. Thus, if for this year the CBA set the target inflation corridor at 6-8 percent, in October the bank reduced expectations to 3-4 percent.
Inflation rate in Azerbaijan was 2.3 percent in January-November 2018, according to Azerbaijan’s State Statistics Committee. Food prices increased by 1.9 percent, non-food prices grew 2.7 percent, while the cost of paid services increased by 2.6 percent.
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