BAKU, Azerbaijan, Jan. 31
By Eldar Janashvili – Trend:
The Board of the Central Bank of Azerbaijan (CBA) has decided to reduce the interest rate by 0.25 percentage points from 7.5 to 7.25 percent, Chairman of the Central Bank of Azerbaijan (CBA) Elman Rustamov said.
Rustamov made the remark in Baku at the press-conference, Trend reports.
At the same time, the lower threshold of the interest rate corridor was reduced from 5.75 to 5.5 percent, while the upper threshold - from 9.25 percent to 9 percent.
This decision entered into force on January 31.
This is the first reduction in the interest rate by the Central Bank in 2020.
Since the recent meeting of the CBA's board on monetary policy, inflation rate did not go beyond the forecasted trajectory and remained below the average value of the target range, said Rustamov.
A surplus current account balance, a stable exchange rate, adequate monetary conditions and low inflation expectations had a stabilizing effect on the prices.
According to the CBA chairman, the risks for the medium term are mainly associated with external factors, in particular, with a slowdown in the global economy and the impact of this factor on oil prices.
At the same time, internal risk factors include an increase in the money supply as a result of growth in budget expenditures and inflationary expansion of consumer loans.
In 2019, the interest rate was reduced from 9.75 percent to 7.5 percent in 2019.