BAKU, Azerbaijan, Feb.20
By Tamilla Mammadova – Trend:
The annual inflation of consumer prices amounted to 2.4 percent in December, t, which is only slightly lower than the targeted 3 percent, Trend reports via the ISET-PI, a think-tank based at the International School of Economics of Tbilisi State University.
However, a relatively low level of inflation over the last two months is related to the government subsidy of utility fees (which reduced the annual inflation rate by 1.9 ppts).
Approximately 1.9 percentage points of CPI inflation were related to higher food prices, which increased 6.7 percent annually (of which 0.8 ppts are related to cheese and oil prices), while tobacco prices contributed 0.4 percentage points.
However, decreased oil prices made a notable negative contribution (0.6 ppts) to the annual inflation measure. The latter trend is mostly a reflection of significantly weakened oil prices on the global market (Euro Brent Spot Price (COP) decreased by 25.7 percent yearly).
Meanwhile, the measure of core inflation amounted to 4.9 percent. Overall, CPI-related variables had a slight positive contribution to the GDP forecast.
In December 2020, the total volume of commercial banks’ consumer credit increased by only 2.2 percent monthly and 15.2 percent yearly. However, the credit volume of commercial banks’ short-term consumer credits reduced by 0.5 percent and 7.1 percent in monthly and yearly terms, respectively (the main driver behind this negative trend being short-term consumer loans in the national currency, which reduced by 21.8 percent monthly and 47.8 percent annually).
Whereas, the credit volume of commercial banks’ long-term consumer credits increased by 2.3 percent monthly and 16.4 percent yearly. Overall, the variables related to consumer credit have had a negative impact on the growth forecast.
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