The Central Bank of the Republic of Azerbaijan held a Management Board meeting, dedicated to results of Q1, 2014 and upcoming tasks. The meeting participants noted that the national economy continued to grow in the first quarter of the current year, driven primarily by the non-oil economy. The economy maintained a favorable foreign economic position, while strategic foreign exchange reserves demonstrated an incremental path. Macroeconomic stability strengthened, inflation further declined, and the average annual inflation made up only 2% over the quarter. The stable exchange rate of manat critically contributed to macroeconomic stability.
The Management Board of the CBA decided to reduce the refinancing rate from 4.75% to 4.25% from 1 May 2014 in order to provide necessary support for further enhancement of the investment activity in the non-oil sector and diversification of the national economy, as well as to pave the way to continuous reduction of interest rates, given the low level of inflation. Additionally, the parameters of the interest rate corridor also underwent changes. The corridor ceiling was shifted from 7% down to 6%, and the corridor floor from 1% to 0.5%.