In Azerbaijan, short-term interest rates in the unsecured money market are stabilizing within the Central Bank of Azerbaijan's (CBA) interest rate corridor, aligning closely with the benchmark discount rate. This development reflects the ongoing adjustments in the country's monetary policy framework.
According to the Operative Information Center-OMM, which cited official data from the CBA, monetary policy instruments are being actively deployed while accounting for current financial market processes and liquidity indicators within the banking system.
The CBA reported that the average daily indicator for the AZIR rate has remained in the 6.43-6.44% range since the end of March 2026. To manage the AZIR rate near the discount rate amidst surplus liquidity, the regulator primarily utilizes 7-day deposit operations. As of the end of May, 7-day deposit operations accounted for 88.7% of the sterilization portfolio in open market operations. Furthermore, the CBA continues to hold regular auctions for the placement of its notes, with yields across all maturities showing a downward trend throughout May and June. Analysts expect surplus liquidity in the banking sector to increase further throughout the remainder of the year.
The Central Bank of Azerbaijan, as the primary regulatory body for the nation's financial system, plays a critical role in maintaining macroeconomic stability and controlling inflation. By managing liquidity and interest rates, the CBA aims to ensure the efficiency of the banking sector and support sustainable economic growth in Azerbaijan.
