The Central Bank of Azerbaijan can again reduce the discount rate during the next meeting of the Board, Director of the Training Center of the Ministry of Taxes of the country, economist Farhad Amirbekov believes.
The expert noted that macroeconomic indicators were favorable for further reduction of the discount rate.
“The situation is stable from the macroeconomic point of view. Inflation amounts to 3%, and the interest rate – to 10%. The spread is quite large, so most likely the Central Bank will agree to another reduction of the interest rate. The reduction is likely to be cautious, as previously, because this is the standard policy of all national banks,” Amirbekov said.
At the same time, the expert added that today the conclusions could be drawn only unilaterally – based only on macroeconomic indicators.
“Unfortunately, the information on the situation on the interbank credit market regarding interest rates in manats is currently unavailable. This is also one of the important indicators, because the liquid interbank market shows certain trends on which the Central Bank can rely when making a decision,” Amirbekov said.
The Central Bank of Azerbaijan reduced the discount rate from 11% to 10% on June 14. The cap of the interest rate collar was reduced from 14% to 12%. The floor of the interest rate collar was maintained at 8%.
In February the CBA reduced the discount rate from 15% to 13%, and in April – from 13% to 11%. Next time, the parameters of the interest rate collar will be discussed in August. (Trend/Business World Magazine)