The Central Bank of Azerbaijan lowered the discount rate today from 8% to 7.75%
According to the bank, the top limit of the interest rate corridor was lowered from 9% to 8.75% and the lower limit from 6.5% to 6.25%.
"This decision was made because actual and forecasted inflation is within the target corridor (4±2%), stabilization of inflation expectations, as well as the situation in the foreign exchange market. The annual inflation rate has declined since the last Monetary Policy Board meeting," the regulator said.
Twelve-month inflation stood at 2.1% in 2023, annual food inflation amounted to 0.8%. The bank noted that annual inflation declined due to the impact of external and domestic factors.
"Weakening global economic activity, as well as the continued decline in global commodity, energy, and food prices, have limited the importation of inflation into the country. According to the World Bank, the commodity price index fell 18.9% year on year in December last year, including a 24% drop in energy prices. According to the UN Food and Agriculture Organization (FAO), the food price index declined by 10.1% year-on-year in December," the statement reads.
The bank stressed that the possibility of step-by-step monetary policy easing during the rest of the year will be considered
