Kyrgyz Central Bank Holds Key Rate at 12%

The National Bank of the Kyrgyz Republic left its benchmark interest rate unchanged at 12% at its May 25, 2026 meeting, maintaining tight monetary conditions to contain inflationary pressures. Inflation rose 4.7% since the start of 2026, with annual inflation reaching 10.9% as of May 15, driven mainly by higher food prices and services costs. The central bank noted that escalating geopolitical tensions in the Middle East have increased volatility in global energy and food markets, fueling imported inflation in the highly import-dependent economy. Meanwhile, the economy continued to expand at a strong pace, with real GDP growing 12.4% year-on-year in January-April, supported by gains in services, industry, and construction amid rising investment activity. The bank said the domestic foreign exchange and money markets remain stable and reiterated that it stands ready to act if risks to price stability intensify. The next policy meeting is scheduled for July 27, 2026.

The National Bank of the Kyrgyz Republic left its benchmark interest rate unchanged at 12% at its April 27, 2026 meeting, maintaining the highest borrowing costs since March 2024 to contain rising inflation. Inflation rose 3.9% since the start of 2026 and annual inflation reached 11.3% as of April 17, driven by higher food, non-food, and especially services prices. The central bank pointed to rising global prices for cereals, vegetable oils, and energy products amid escalating Middle East tensions, alongside elevated inflation in trading partners and higher logistics costs, as ongoing sources of imported inflation. Domestic demand also remained strong, supported by wage growth and remittance inflows, while real GDP expanded 10.1% year-on-year in January-March. Despite relatively stable exchange rate dynamics helping anchor expectations, the bank said tight monetary conditions remain necessary to return inflation to its 5–7% target. The next policy meeting is scheduled for May 25, 2026.

The National Bank of the Kyrgyz Republic raised its benchmark interest rate by 100 basis points to 12.00% at its February 23, 2026 meeting, marking the highest borrowing costs since March 2024. Inflation has risen by 1.8% since the start of 2026, with annualized inflation at 9.6%. While food price growth has moderated, services and non-food prices remain elevated, driven by robust consumer demand and secondary external effects. Economic activity continues to expand at a solid pace, with real GDP growing 9.0% year-on-year in January, supported by construction and services. The central bank noted stable financial and foreign exchange markets but emphasized risks from global supply chain disruptions, geopolitical tensions, and high inflation among trading partners. It reiterated its commitment to guiding inflation back to its 5–7% medium-term target and signaled readiness to adjust policy further if price stability risks intensify. The next policy meeting is set for April 27, 2026.