Baku, Azerbaijan, Aug. 30
By Eldar Janashvili - Trend:
The inflation rate in Azerbaijan amounted to 2.5 percent in January in both 2019 and 2018, said by Head of Azerbaijan’s Financial Market Supervisory Authority (FIMSA) Vugar Gulmammadov, Trend reports.
He noted that despite a 1.5-percent increase in the consumer price index for the first quarter, it dropped by 0.5 percent for the second quarter (when compared to the previous one), due to seasonal factors.
The decrease in the influence of seasonal factors on price growth during this period led to the inflation being lower than the calculated core inflation at 2.7 percent (excluding government-regulated products and services, as well as seasonal agricultural products). Overall, for the first six months of 2019, the price index tends to increase compared to the corresponding period of 2018, he added.
According to Gulmammadov, the Central Bank of Azerbaijan (CBA) continued its moderate monetary policy for the first half of this year (based on satisfactory macroeconomic and inflation indicators) and once again reduced the discount rate, determining at the rate of 8.5 percent.
According to CBA, despite the fact that the dollar supply exceeded demand and the exchange rate was determined at foreign exchange auctions, there were no trends in the appreciation of the manat. On the other hand, there is an excess of money supply in national currency in the banking system.
Thus, despite the regular decrease in average yield at deposit auctions conducted by the CBA for raising funds, demand continues to significantly exceed supply by 5-6 times. In case of a dollar surplus in the domestic foreign exchange market, the money supply will be sterilized in order to maintain inflation, Gulmammadov said.
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