BAKU, Azerbaijan, September 5. Last week, Central Bank of Azerbaijan (CBA) has decided to reduce the lower limit of the interest rate corridor by 2.25 percent, from 6.25 to 4 percent, Trend reports.
Central Bank of Azerbaijan had set a task to gradually bring interbank interest rates closer to the interest corridor, preventing sharp fluctuations in interest rates in various segments of the financial market. Depending on macroeconomic situation and situation on the interbank market, as well as the consequences of introducing new instruments to various segments of the financial market, the limits of the Central Bank's interest rate corridor will decrease.
The CBA discussed the current situation of cooperation with Visa, FinTech, CBDC central bank digital currency and support for the 'Smart village' project.
Furthermore, last week new collective agreement on the conclusion of interbank unsecured credit transactions in Azerbaijani manat through the Bloomberg trading platform has entered into force in Azerbaijan.
Also, Central Bank of Azerbaijan (CBA) has started conducting one-day deposit operations as a permanent opportunity for the purpose of sterilization and one-day reverse REPO operations for the purpose of providing liquidity.
According to the CBA, the interest rate on one-day deposit operations for sterilization is equal to the lower limit of the interest corridor, and the interest rate on one-day reverse REPO operations for the purpose of providing liquidity is equal to the upper limit of the interest corridor.
European Bank for Reconstruction and Development (EBRD) unveiled project portfolio in Azerbaijan. Azerbaijan was estimated at 844 million euros as of August 1,2022.
The largest part of the project portfolio (89 percent or 748 million euros) is directed to investments in sustainable infrastructure, 8 percent or 65 million euros to investments in financial institutions, and 3 percent or 31 million euros to industry, trade and the agricultural sector.