ING lowers Azerbaijan's 2026 inflation forecast

Dutch banking group ING has revised its inflation outlook for Azerbaijan, forecasting that annual consumer price growth will remain above 5% through 2028 despite a slight downward adjustment to its 2026 estimate.

According to the bank's latest projections, average annual inflation is expected to reach 5.8% in 2026, 5.6% in 2027, and 5.3% in 2028. The 2026 forecast was lowered by 0.3 percentage points from ING's previous estimate, while the 2027 projection was raised by 0.1 percentage points. The 2028 forecast has been published for the first time, Caliber.Az reports per local media. 

Official figures from Azerbaijan's State Statistics Committee show that average annual inflation accelerated to 5.6% in 2025, compared with 2.2% in 2024. Inflation also averaged 5.6% during the first five months of 2026.

ING expects inflation to average 5.7% in the second quarter of 2026, rise slightly to 5.8% in the third quarter, and ease to 5.6% in the fourth quarter.

The bank's outlook remains more pessimistic than the Azerbaijani government's projections. The Ministry of Economy forecasts average annual inflation of 4.8% in 2026 and 4.5% in 2027, while the Central Bank of Azerbaijan expects inflation to average around 5.9% this year.

International financial institutions generally anticipate lower inflation in Azerbaijan. The United Nations projects inflation at 3.1% in 2026, the World Bank forecasts 2.3%, and the Asian Development Bank expects 3.5%.

Among major credit rating agencies, Moody's projects average annual inflation of 3.0% in 2026, Fitch Ratings forecasts 4.6%, and Fitch Solutions expects inflation to reach 5.5% this year before slowing to 4.8% in 2027.

By Sabina Mammadli