12:12 - 27.05.2025

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May 27, Fineko/abc.az. In 2024, the positive balance of foreign currency receipts to the State Budget and money transfers decreased in Azerbaijan, which led to an increase in demand for foreign currency.

ABC.AZ informs that this is stated in Accounts Chamber’s conclusion to the Bill on the Execution of the State Budget for 2024.

According to the document, with activation of domestic demand factors, the demand for foreign currency at auctions increased, and the impact of fiscal operations on liquidity led to a reduction in sterilization operations.

Last year, $7.169 billion were sold at 95 currency auctions (1.8-fold more than in the previous year). The average demand at auctions increased from $40.4 recorded in the previous year to $75.5. The increase in demand for foreign currency was mainly influenced by a rise in imports amid fiscal incentives.

Compared with the previous year, the increase in sales was also due to the effect of a low base. Thus, about half of the transfers from the State Oil Fund (SOFAZ) were transferred to the State Budget directly in foreign currency without being auctioned.

The increase in demand for foreign currency was also influenced by a decrease in revenues to the State Budget in foreign currency (the profit tax of contractors in the oil & gas sector dropped by 34.4%) and a decline in the positive balance on money transfers (the positive balance on money transfers decreased by 49.7%).

In the reporting year, payments related to external government debt were also one of the factors that influenced the increase in demand for foreign currency.

CBA's official international reserves declined from $11.613 billion at the beginning of the year to $10.959 billion at the end of the year. CBA's interventions aimed at selling have become one of the factors having a reducing effect on the money supply. In the context of fiscal operations conducted last year, there was a decrease in sterilization operations.

At the end of the reporting year, the volume of CBA notes in circulation at face value amounted to 208.2 million manats, which is 1.1 billion manats or 6.3-fold less than at the beginning of the year. In general, the volume of turnover on the securities market increased by 1.863 billion manats in the reporting year, and against the background of the decreasing influence of the CBA notes, the growth in total turnover was fully ensured by government bonds.