Finance

Home page

Finance

Fitch Solutions: Central Bank of Azerbaijan to lower key rate to 6.25%

14 October 2025 12:19 (UTC +04:00)

The Central Bank of Azerbaijan (CBA) will continue its prudent monetary policy against the backdrop of inflationary pressures, this was stated in the forecast for Azerbaijan by Fitch Solutions, a member of the Fitch Group, APA-Economics reports.

According to the report, the CBA will continue its prudent and data-based monetary policy for the rest of 2025 and 2026. According to the company, the Central Bank will not rush to reduce interest rates against the backdrop of inflationary pressures, but may gradually switch to an easing policy if economic growth weakens and price increases stabilize.

Fitch Solutions has forecast the discount rate at 6.75% in 2025 and 6.25% in 2026. This is slightly lower than the average indicators observed in 2020-2024 and is explained by the weakening of economic activity against the backdrop of falling global oil prices.

According to the report, price pressures are persistent and inflation is expected to rise to 6 percent by the end of 2025. The increase is mainly due to rising food prices and tariff adjustments in the service sector. In 2026, these pressures are forecast to decrease somewhat.

It was noted that the CBA's policy rate is currently maintained at 7.00 percent. The Central Bank is taking cautious steps to maintain the 2–6 percent inflation target range and does not intend to lower the rate until price stability is fully restored.

Recall that the CBA has kept the policy rate unchanged since May 2024 and lowered it by 0.25% for the first time in July this year. The CBA will announce its next decision on the policy rate on October 22 this year.