The formation of the inflation level in the target corridor (4±2), adopted in 2019, provided significant support to economic activity, having created certainty in economic conditions, according to the report.
A decisive role in shaping price stability and inflation expectations was played by the active monetary and currency exchange rate policy of the Central Bank.
Consistent normalization of monetary conditions in order to neutralize a number of important internal and external factors of inflation, as well as support economic activity and employment, allowed achieving balanced results in the direction of growth and stability.
From January through November 2019, foreign trade surplus in Azerbaijan amounted to $5.9 billion.
In the non-oil sector, the export growth rate amounted to 16.3 percent, having exceeded the growth rate of imports, equivalent to 7.1 percent.
In the context of a surplus in the balance of payments, strategic foreign currency reserves increased by 13.7 percent since the beginning of 2019 to $50.9 billion, surpassing the gross domestic product. In 2019, for the first time in history, the assets of the State Oil Fund of Azerbaijan (SOFAZ) amounted to $40 billion.
The foreign exchange reserves of the CBA for 2019 increased by 11 percent and amounted to $6.2 billion. Azerbaijan’s assets on international investment position ($111 billion) are two times higher than liabilities ($54 billion), which indicates high international solvency of Azerbaijan and its role as an international creditor.
Positive dynamics in economic activity continued in 2019. Real GDP from January through November increased by 2.1 percent. Non-oil sector growth of 3.5 percent is mainly related to the commercial sector. In the non-oil industry, it grew by 14.8 percent, in agriculture - by 7.1 percent. Monitoring of the real sector held by the CBA also confirms the growth of economic activity. In November 2019, the business confidence index in the non-oil industry, trade and services improved.
Under the influence of social reform packages implemented in several stages this year, the nominal incomes of the population for 11 months increased by 7.4 percent, which significantly exceeds annual inflation.
In these conditions, an improvement in consumer confidence indicators was noted. The volume of investments in another component of domestic demand in 11 months of 2019 amounted to 12.8 billion manat ($7.5 billion), investments in the non-oil sector grew by 3.5 percent.
Budget expenditures have become one of the important factors of domestic demand this year. State budget expenditures for 11 months of 2019 increased by 2.6 percent, including current expenses - by 12.5 percent, taking into account the same period last year.