IMF advises Azerbaijan to tighten monetary policy if inflation soars
Azerbaijan should tighten monetary policy over the short term if the increase in aggregate demand leads to inflationary pressure, head of International Monetary Fund mission in the country and deputy director of the Middle East and Central Asia department, Nadeem Ilahi, has said.
An IMF mission has been on a visit to Baku since October 20, which ends November 2, to conduct consultations with the Azerbaijani government under Article IV of the IMF's Articles of Agreement. The consultations are held on a regular basis every year.
"It would be useful for the government to strengthen the instruments of monetary policy to better control inflation in the middle-term prospect," Ilahi told a press conference in Baku on Tuesday.
Regarding the banking system, Ilahi said Azerbaijan should strengthen banking supervision and resolve quickly the issues of liquidity and sufficiency of capital in the banking system, while maintaining financial stability.
Azerbaijan has been cooperating with the IMF since 1992. Consultations under Article IV of the mentioned agreement have been conducted in the past six years.
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