Azerbaijan and other CIS countries - Uzbekistan, Kazakhstan, and Armenia - have limited opportunities to lower their interest rates, "ING Group", the largest financial group in the Netherlands, said in its forecast, APA reports.
"The central banks of Azerbaijan, Uzbekistan, and most recently Armenia followed the earlier example of Kazakhstan in expressing concerns about the growing inflationary risks coming from the external environment. In all four meetings over the past month, the respective policy rates were kept unchanged, in some cases contrary to signals and market expectations of a cut. The CPI trajectories are generally pointing up, further reinforcing our expectations that the room for key rate cuts for the foreseeable future is extremely low," ING emphasized.
The financial group has announced that it has raised its Consumer Price Index (CPI) expectations for countries in the region by 0.5–1.0 percentage points. Nevertheless, ING has revised down its inflation forecast for Azerbaijan for the second quarter of 2025 from 6.1% to 5.9%, for the third quarter from 4.6% to 4.4%, for the fourth quarter from 4.7% to 4.6%, and for the full year from 5.2% to 5.1%. ING has only raised its forecast for the fourth quarter of 2026 from 5.6% to 5.7%.
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