The Central Bank of the Republic of Azerbaijan kept its policy rate at 6.5% and the upper bound of its interest rate corridor at 7.5%, while cutting the lower bound by 0.5 percentage points to 5%. Effective Sept. 24, the wider corridor is intended to encourage banks to trade excess liquidity among themselves and reduce the central bank’s role in the money market, while the unchanged policy rate and upper bound support inflation expectations. Annual inflation eased to 5.7% in August and remained within the target range, while core inflation was 5.1%. The banking sector’s structural liquidity surplus reached AZN 6.3 billion at the end of August, 2.2 times its December level, and the AZIR benchmark declined to 6.02% in September to date. Foreign currency supply continued to exceed demand, helping central bank reserves rise 32.9% over eight months to a record USD 15.3 billion. The next interest rate corridor decision and related press conference have been brought forward to Oct. 29 from Nov. 4.
2026-09-23Central Bank of the Republic of Azerbaijan
Central Bank of the Republic of Azerbaijan holds policy rate at 6.5%, cuts lower corridor bound to 5%
The Central Bank of the Republic of Azerbaijan held its policy rate at 6.5% and the corridor’s upper bound at 7.5%, while cutting the lower bound to 5% from Sept. 24. The wider corridor is designed to stimulate interbank trading amid a structural liquidity surplus of AZN 6.3 billion, while annual inflation remained within target at 5.7%.