BAKU, Azerbaijan, November 1. The Central Bank of Azerbaijan (CBA) has decided to keep the refinancing rate unchanged at the level of 7.25 percent, Trend reports.
According to the CBA, the upper and lower bounds of the interest rate corridor stayed the same at 8.25 percent and 6.25 percent, respectively, keeping everything on an even footing.
The bank also pointed out that annual inflation is projected to be 5.1 percent by the end of 2024 and 5.8 percent in 2025.
The current monetary policy is aimed at maintaining inflation within the target range and stabilizing inflation expectations. Under the current policy, annual inflation is expected to remain within the target indicator (4±2 percent) by the end of 2024 and in 2025 under the baseline scenario.
Further decisions regarding the parameters of the interest rate corridor will depend on the dynamics of actual and projected inflation, as well as external and internal risk factors. The CBA continuously monitors ongoing economic processes and financial markets and will use all available means to ensure price stability.
In October of this year, the CBA conducted special foreign currency sales amounting to $424 million to support government expenditures (including state projects and events, defense, reducing foreign currency liabilities, and other strategically important projects).
This year, stability has been maintained in the foreign exchange market, fully meeting demand during currency auctions organized by the CBA. Overall, the foreign exchange market is functioning under conditions of a surplus balance of payments.
As a result, the CBA's foreign currency reserves decreased by $241 million over the past 10 months.
The currency sales were made using foreign currency amounting to $2.1 billion, which was purchased in the foreign exchange market in 2023. These sales help sterilize part of the increasing money supply through foreign exchange interventions aimed at previous purchases, thereby supporting macroeconomic stability in the medium term.
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