EBRD: Azerbaijan has strong fiscal, external buffers

Azerbaijan's fiscal and external buffers remain strong, according to the European Bank for Reconstruction and Development's (EBRD) September Regional Economic Prospects update, Report informs.

"Fiscal and external buffers remain strong. The state budget recorded a surplus of 4.4 percent of GDP in the first half of 2025, slightly below that of 2024, as revenues and oil prices surpassed budget projections. Foreign reserves (including the assets of SOFAZ, the state oil fund) reached $78.8 billion by mid-2025, covering more than three years of imports. As a result, Moody's upgraded Azerbaijan's sovereign rating to Baa3 in June 2025, highlighting the country's fiscal resilience," reads the update.

"Headline inflation picked up from an average of 2.2 percent in 2024 to 5.6 percent in the first eight months of 2025, driven by rising prices of food and services. In July 2025, the Central Bank of Azerbaijan lowered its policy rate by 25 basis points to 7.0 per cent, bringing cumulative easing since late 2023 to 200 basis points, despite inflation running close to the upper end of the 4 percent (±2) target band."