BAKU, Azerbaijan, August 18. Azerbaijan has revised its macroeconomic forecasts for 2026 following the first six months of economic and fiscal results, as well as changes in expectations for global economic growth and energy prices, the Finance Ministry said.
The economy is now expected to grow by 1.7% in real terms in 2026, with gross domestic product reaching $81.18 billion (AZN 138.0 billion). That is AZN 3.9 billion ($2.29 billion) higher in nominal terms than the forecast used when the state budget draft was prepared.
Non-oil GDP is expected to grow by 3.1% in real terms to $58.82 billion (AZN 100.0 billion), which is AZN 1.7 billion ($1.0 billion) lower in nominal terms than the previous forecast.
The ministry said lower-than-expected growth in the construction and tourism sectors had weighed on the outlook for the broader non-oil and gas economy.
As a result, the forecast for real growth in the non-oil and gas sector in 2026 was cut to 3.1% from 5.0%.
The ministry also raised its forecast for average annual inflation in 2026 to 5.7% from 4.8%, citing actual inflation in the first part of the year, global commodity and food prices and their impact on import prices, changes in regulated prices for goods and services, and other factors.
The ministry said higher energy prices amid continuing geopolitical tensions in the Middle East had increased inflationary pressures and raised expectations of tighter monetary policy.
Global growth forecasts have also been revised by major international financial institutions.
The International Monetary Fund (IMF) lowered its 2026 global growth forecast by 0.1 percentage point from its April forecast to 3.0% in its latest July outlook. The World Bank also cut its 2026 global growth forecast by 0.1 percentage point in June, to 2.5%.
International financial institutions and agencies currently expect the average annual price of crude oil to be in the range of $82-$94 per barrel in 2026.
The IMF's July forecast assumed an average oil price of about $89 per barrel for 2026 based on market pricing at the time, while the World Bank's June outlook projected Brent crude at an average of $94 per barrel.
