Azerbaijan's CBA reveals factors affecting monetary policy in 2020
BAKU, Azerbaijan, Dec. 29
By Zeyni Jafarov – Trend:
The current year has been mainly сharacterized by the fight against the COVID-19 pandemic, Trend reports citing the Central Bank of Azerbaijan (CBA).
According to the CBA, the plummeting global trade, supply chain disruptions, job closings, and growing epidemiological uncertainty have negatively impacted global economic activity. All these factors directly or indirectly affected the economy of Azerbaijan. The implemented targeted policy allowed to minimize the negative consequences of the pandemic and macroeconomic and financial stability was ensured in the country.
The processes that have taken place in the past few years gave reason to believe that 2020 will be difficult. It’s no coincidence that since late 2018, the International Monetary Fund (IMF) has adjusted its forecast for global economic growth toward a decline in every report. The average oil price in 2018 fluctuated within $72, while in 2019 it made up$64, which was a 12 percent decline, said the bank.
As the latest IMF forecasts showed, the global economy is expected to contract 4.4 percent in 2020, faster than the economic slowdown during the 2008-2009 financial crisis. Including in developed countries a recession of 5.8 percent is forecasted, for developing countries - 3.3 percent.
The recession is expected by the countries-trade partners of Azerbaijan by an average of 7.1 percent. To mitigate the recession, a number of countries announced large packages of fiscal incentives to support households and businesses and implemented expansionary monetary policy measures.
Earlier the head of the CBA Elman Rustamov noted that despite the events related to the pandemic and Azerbaijan’s Patriotic War for the liberation of its lands from the occupation, the financial sector will end the current year with good performance.