BAKU, Azerbaijan, Mar.19
By Zeyni Jafarov - Trend:
Monetary conditions haven’t considerably changed in Azerbaijan since the last meeting of the Board of the country's Central Bank (CBA), Trend reports on Mar.19 referring to the CBA.
According to the CBA, the money supply is mainly influenced by the change in the balance on the single treasury account.
The reduction in the monetary base since the beginning of the year is temporary in nature and is associated with a budget surplus. In the remaining period of the year, the replacement of this surplus with a deficit will be accompanied by an increase in the monetary base, noted the bank.
The CBA stated that since the last meeting, the yield on government securities has slightly increased, and on the bank’s notes - has remained unchanged. Interest fees on the interbank market, as well as the fees on loans and deposits, remained largely stable. The fact that nominal interest fees remained unchanged amid rising inflation means that real interest fees fall.
Besides, the Central Bank noted that the restoration of the growth of credit investments in the economy began. From January through February 2021, credit investments in the banking system have grown by 0.6 percent, including on business loans - by 0.6 percent, and on mortgage loans - by 3.2 percent, while consumer loans fell by 0.7 percent. Credit growth is expected to continue in parallel with economic activity.
The continuation of the government's concessional lending programs and the macro-prudential easing process will also further support this growth.
Stability in the foreign exchange market is one of the main conditions for maintaining stable inflationary expectations. The demand for currency at the CBA auctions in February and March 2021 was significantly lower than in January.
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