The Central Bank of Azerbaijan (CBA) will announce its next decision on the parameters of the interest rate corridor this week, APA-Economics reports.
According to the CBA's schedule for publicly announcing monetary policy decisions in 2026, the next decision will be announced on September 23.
It should be noted that at its last meeting on July 31, the Central Bank's Board decided to keep all parameters of the interest rate corridor unchanged. Currently, the refinancing rate stands at 6.5%, the lower bound of the interest rate corridor at 5.5%, and the upper bound at 7.5%.
The latest decision was made taking into account inflation dynamics and forecasts, the situation in the foreign exchange market, and developments in the domestic financial market.
In August, Azerbaijan's 12-month inflation rate stood at 5.7%. Thus, inflation remains within the Central Bank's target range of 4±2%, close to its upper limit. Current inflation dynamics are among the factors limiting the scope for interest rate cuts. At the same time, the fact that inflation has not exceeded the target range also weakens pressure to raise interest rates. In this regard, keeping the parameters of the interest rate corridor unchanged at the September meeting could be considered one of the possible scenarios.
According to the CBA's latest forecast, annual inflation is expected to reach 6.1% by the end of 2026, 6% in June 2027, and 5.8% by the end of 2027.
In its previous decision, the Central Bank stated that future decisions on the interest rate corridor would be made taking into account inflation forecasts and the dynamics of macroeconomic indicators.
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