IMF forecasts 12% inflation rate in Azerbaijan

He says that growth of the inflation rate will depend on the tax policy of the Budget. "The Government said to maintain one-digit inflation rate for 2006-2007. But, something should be done for the maintenance. Our forecast is based on the fact that the current budget has over expenditures," he said.

He says the reasons for growth of inflation are that petrodollars create great demand for national currency and the inflation speeds up. "Dollar and manat exchange in the external market would be expedient," he added, APA reports.