As reported by FinFly citing the Central Bank of Azerbaijan (CBA), the forecast for keeping annual inflation within the target range in the current and next years remains unchanged.
At the same time, the regulator notes the activation of external cost factors affecting inflationary processes.
"Since the previous meeting, changes in the global economic environment have increased the likelihood of stronger external inflationary risks. In a rapidly changing global environment, rising world prices for food and fertilizers, increased transport and logistics costs, expansion of imported inflation from trading partner countries, as well as a slowdown in the appreciation of the nominal effective exchange rate could amplify external inflationary risks," the CBA statement said.
The Central Bank noted that an in-depth analysis of the sustainability of these factors and their impact on inflationary processes is currently underway.
At the same time, according to the regulator, in the domestic economy, the probability of excessive expansion of aggregate demand amid the current fiscal and monetary policy remains low.
The CBA notes that as of the end of May, annual inflation in Azerbaijan stood at 5.6 percent.