The Central Bank of Azerbaijan will not reduce the interest rate in its upcoming decisions, APA-Economics reports, citing ING Group, the largest financial group in the Netherlands.
The report noted that amid current inflation risks, there is no additional room for the Central Bank of Azerbaijan (CBA) to lower the interest rate. It was stated that global and domestic inflationary pressures, particularly rising food prices and tariff increases, are the main constraining factors for monetary easing.
ING analysts emphasized that since 2025, inflation has remained in the 5–6% range, and at the beginning of 2026, an increase was observed again due to changes in domestic utility tariffs. At the same time, the fact that a significant portion of Azerbaijan’s imports originates from regions affected by geopolitical tensions in the Middle East increases upside risks to inflation.
The report stated that further monetary easing would only be possible if inflation declines unexpectedly. However, under current conditions, such a scenario is not considered the baseline expectation.
Note that the CBA will announce its next decision on the interest rate tomorrow, April 2. Previously, on February 4, the CBA reduced all parameters of the interest rate corridor by 0.25 percentage points. The interest rate was lowered to 6.5%, the lower bound of the corridor to 5.5%, and the upper bound to 7.5%.
