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Qabil Ashirov

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Dutch banking group ING Group expects Azerbaijan's average annual inflation to reach 5.7% in 2026, 5.6% in 2027 and 6% in 2028.

The projections are included in the group's economic outlook updated on November 10.

According to ING Group's estimates, annual inflation in Azerbaijan is expected to stand at 5.7% in both the third and fourth quarters of 2026.

For 2027, the group forecasts inflation of 5.5% in the first quarter, remaining at the same level in the second quarter. The rate is projected to decline to 5.4% in both the third and fourth quarters.

As a result, ING Group expects average annual inflation to reach 5.6% in 2027 before rising to 6% in 2028.

Meanwhile, the Central Bank of Azerbaijan (CBA) expects annual inflation to remain within its target range over the medium term.

According to the CBA's October baseline projections, annual inflation is expected to reach 5.9% at the end of both 2026 and 2027.

Compared with its July forecasts, the central bank revised its inflation projection for 2026 downward by 0.2 percentage points and raised its forecast for 2027 by 0.1 percentage points.

The CBA noted that its baseline scenario assumes that state-regulated prices and tariffs will remain unchanged. The CBA also reported that annual inflation remained within its target range of 4% ± 2% and followed the trajectory envisaged in its baseline scenario.

In September 2026, 12-month inflation stood at 5.5%, down 0.2 percentage points from August.

Annual price increases were recorded at 6.9% for food products, alcoholic beverages and tobacco products, 5.1% for paid services and 3.6% for non-food goods.

Annual core inflation stood at 4.9%.