Kyrgyz Central Bank Stands Pat at 12%

The National Bank of the Kyrgyz Republic left its benchmark interest rate unchanged at 12.0% at its July 27, 2026 meeting, maintaining tight monetary conditions to contain persistent inflationary pressures. Inflation rose 6.5% since the start of 2026, with annual inflation reaching 11.3%, driven by higher food and fuel prices amid volatility in global commodity markets and heightened tensions in the Middle East. The central bank warned that risks to oil product supplies through the Strait of Hormuz continue to fuel imported inflation, while rising service costs have also been supported by tax reforms. Meanwhile, the economy remained resilient, with real GDP expanding 11.9% year-on-year, supported by strong domestic demand and robust investment, particularly in construction. The bank reaffirmed that it will maintain restrictive monetary conditions to steer inflation toward its 5%–7% medium-term target and stands ready to tighten policy further if risks to price stability intensify.

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.