04 March 2016, Baku: Consistent measures have been taken recently to ensure sustainable macroeconomic stability, stimulate wider use of the national currency as a means of saving, and develop financial markets. Investment of government securities with high yields, while setting a higher corridor ceiling for the guaranteed national currency deposits aims at strengthening the confidence in manat.

Given the targets of ensuring macroeconomic stability and new trends in financial markets, the Central Bank has revised the parameters of the interest rate corridor. By the decision of the CBA Management Board, the refinancing rate was set at 7 percent, and the corridor ceiling for liquidity operations at 17 percent on 4 March 2016. The corridor floor for liquidity operations remained unchanged at 2 percent.

At the same time, it was decided to extend the duration of operations for liquidity injection and attraction at interest rates at the corridor floor and ceiling levels from one to seven days. To manage the short-term liquidity, banks will be able to use 1-7 day repo/reverse repo operations – the CBA’s framework tool – on their own initiative. In addition, the CBA has taken decisions on differentiation of mandatory reserve requirements and developed a relevant regulatory basis. Further information will be provided in this regard.