Azernews.Az

Akbar Novruz

Read more

Dutch banking group ING forecasts that Azerbaijan’s economy will grow by 1.9% in 2026, followed by growth of 3% in 2027 and 2.3% in 2028, according to the bank’s latest forecasts.

ING has revised its 2026 growth projection downward by 0.1 percentage point from its previous estimate, while keeping its forecasts for 2027 and 2028 unchanged.

Based on the bank’s projections, Azerbaijan’s average annual GDP growth for 2026-2028 is expected to stand at around 2.4%.

ING expects economic growth to accelerate during the second half of 2026, reaching 3% in the third quarter and 3.3% in the fourth quarter.

For 2027, the bank forecasts GDP growth of 3% in the first quarter, 3.5% in the second quarter, 2% in the third quarter and 3.5% in the fourth quarter.

Azerbaijan’s economy grew by 1.4% in 2025, according to official data.

The forecasts from ING are above the Azerbaijani government’s current projection for 2026. The Ministry of Economy expects GDP to expand by 1.7% this year, with the non-oil and gas sector growing by 3.7% while the oil and gas sector contracts by 3.3%.

Meanwhile, the Central Bank of Azerbaijan has a more conservative outlook, forecasting GDP growth of 0.5% in 2026 and 2.6% in 2027.

ING also expects inflation in Azerbaijan to remain elevated but gradually ease over the medium term.

According to the bank, inflation is projected at 5.8% in 2026, declining to 5.6% in 2027 and 5.3% in 2028.

Quarterly inflation is forecast at 5.8% in the third quarter of 2026 and 5.9% in the fourth quarter.

For 2027, ING expects inflation to remain at 5.8% in the first and second quarters, before easing to 5.4% in the third and fourth quarters.

The Central Bank of Azerbaijan has also projected that inflation will return to its target range over the medium term.

According to the CBA’s July base-case forecast, annual inflation is expected to reach 6.1% at the end of 2026, 6% in June 2027 and 5.8% at the end of 2027.