WB announces inflation forecast in Azerbaijan until 2027

According to the World Bank (WB) forecasts, annual inflation in Azerbaijan will reach three per cent in 2024, 3.5 per cent in 2025 and four per cent in 2026.

“Average annual inflation rate is projected to remain low at 2.2 per cent over the medium term thanks to the moderate growth in domestic demand and stabilisation in global food prices,” Report informs citing the April World Bank report on Europe and Central Asia “Unlocking the Power of the Private Sector” released on April 11.

Annual inflation in 2023 reached 2.1 per cent, approaching the lower limit of the Central Bank of Azerbaijan’s (CBA) target inflation range of 4 +/-2 per cent.

The CBA has decreased the discount rate by four times since October 2023 by a total of 125 basis points, bringing it to 7.5 per cent as of late March 2024.

According to the Azerbaijani State Statistics Committee, the consumer price index in Azerbaijan in January-March 2024 reached 101 per cent compared to the same period of last year, including 99.7 per cent for food, drinks and tobacco products, 101.4 per cent for non-food products, 102.5 per cent for paid services to the population.

The inflation rate was observed at 0.2 per cent in Azerbaijan in March 2024 compared to 0.6 per cent in February, while for the year it reached 0.4 per cent.

The Azerbaijani government forecasts average annual inflation rate at 5.3 per cent for 2024.

The average annual inflation rate in Azerbaijan was 8.8 per cent in 2023.