The Central Bank of Azerbaijan kept its benchmark interest rate unchanged at 9.75 percent on December 26th, noting uncertainties in the external environment. The decision follows four rate cuts this year, bringing borrowing costs to its lowest since August 2016, as inflation rate continued to fall. In the January to November period, annual inflation was 2.3 percent, the lowest since early 2015. Policymakers expect inflation at the end of the year to be around 2.3 percent. Interest Rate in Azerbaijan averaged 6.68 percent from 2005 until 2018, reaching an all time high of 15 percent in September of 2016 and a record low of 2 percent in December of 2009.
Interest Rate in Azerbaijan is expected to be 9.25 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Interest Rate in Azerbaijan to stand at 7.50 in 12 months time. In the long-term, the Azerbaijan Interest Rate is projected to trend around 7.00 percent in 2020, according to our econometric models.