The Central Bank of Azerbaijan increased from February 15, 2016 the discount rate from 3% to 5%. The interest rate corridor was also formed by the CBA: interest rates on continuous operations for absorption and liquidity provision are now forming 2% per annum at the bottom and 10% at the top of the interest rate corridor boundaries, symmetric with respect to the key rate. The upper limit is increased by 5 points.
In fact, the bank returned to a rate which operated until 10 December 2012.
Measures are taken to optimize macro index forecasts and stabilize the market price in the medium term.
The expert Samir Aliyev believes that the CBA was late with this decision, which, in his opinion, had to be taken after the devaluation of the manat.
"This step of the CBA is aimed at reducing inflation and the increased activity of the manat," he wrote on his page on Facebook.
According to him, to satisfy the requests of banks the Central Bank will increase the manat supply, which can lead to higher prices of loans and reduced business activity. "We see that keeping the price stability is considered higher priority than economic activity," says Samir Aliyev. -0-
Economics
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On July 26, the Ministry of Economy hosted a meeting with entrepreneurs from the non-oil industry to explore ways to stimulate local production and enhance export potential.
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Azerbaijani internet service providers Aztelekom and Baktelekom will introduce substantial changes to their pricing structure starting August 15, the companies announced today. Under the new tariffs, the minimum internet speed will rise to 100 Mbit/s, with the cost per Mbit/s decreasing from 0.45 AZN to 0.25 AZN. As a result, monthly charges will be set at 25 AZN for 100 Mbit/s, 30 AZN for 150 Mbit/s, and 36 AZN for 250 Mbit/s.
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Independent experts suggest that Azerbaijan may be on the verge of another devaluation of its currency, the manat, due to a shrinking trade and payment surplus. The anticipated economic adjustments come amidst a decline in foreign currency inflows and reduced oil production.
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Azerbaijan’s Foreign Minister Jeyhun Bayramov met today with Ahmed Moallim Figi, the Minister of Foreign Affairs and International Cooperation of Somalia, at the Azerbaijani Foreign Ministry. This meeting followed a discussion held the previous day between Figi and Azerbaijan’s Economy Minister Mikail Jabbarov.
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