Manat devaluation not affects inflation rate

The inflation level in Azerbaijan remained at the acceptable level despite the devaluation of the national currency, the manat.

Azer Alasgarov, the Head of the Monetary Policy Department of Central Bank of Azerbaijan, made the remark at the conference “G20: Priorities of Turkey’s chairmanship and the new opportunities for economic cooperation of Azerbaijan” on May 14.

Alasgarov said that the exchange rate policy of the CBA allowed neutralizing the strengthening of the exchange rate of manat that has been observed in recent years.

Deflation in Azerbaijan stood at 0.2 percent in April 2015 compared to March, according to the data from the country’s State Statistical Committee.

Prices for food products increased by 0.5 percent in April, while the prices for non-food products dropped by 0.5 percent, tariffs and financial services to the population – by 0.9 percent.

He also touched upon the affect of the decrease in the volume of world trade on the level of Azerbaijan’s foreign trade operations.

Alasgarov said that the country’s trade turnover decreased by 18.6 percent, export – by 37.1 percent and import – by 37.7 percent in Q1 of 2015, compared to the same period of 2014.

“This decrease is mainly related to the situation in the oil market,” he said. “Aside from the foreign trade turnover, the volume of money transfers to the country has also dropped.”

Alasgarov added that the volume of money transfers to Azerbaijan has decreased by 36 percent.

Meanwhile, demand for the foreign currency has increased due to the decrease of the exchange rate of Azerbaijani manat. “The volume of cash currency sales to the population has increased by 2.1 times.”