It was noted at the meeting that the economic growth was caused by consumption expenditures, increase of state demand and net foreign demand: “More increase of economic growth in the current year will depend on acceleration of planed structural reforms, extension of net foreign demand, investment activity, as well as restoration of financial intermediation”.
In the first quarter of 2017, positive changes occurred in the balance of payment – the deficit (-2.5B USD) was substituted by surplus (0.7B USD). Surplus of foreign trade turnover doubled. In the reporting period, both oil and non-oilk export increased, non-oil import decreased.
After switching to floating regime, the supply exceeds demand in the currency market, sustainability of manat rate is increasing: “No significant changes are forecasted within the macroeconomic situation by the year-end.”
In the condition of targeting of money supply, the central bank carried out quick monetary policy in the past period. Taking into account the expectation on switching to the floating regime within the adopted monetary program, the central bank limited monetary base in early 2017, restored money supply after stabilization of manat rate. In order to meet economy’s demand for money and manage the liquidity effectively, the bank kept instruments of monetary policy active for different periods (1 day, 7 days, 14 days, 28 days).
In the reporting period, the value of the money was formed within the interest corridor of the central bank.
Generally, the monetary policy provided liquidity management and stable operation of payment system.