BAKU, Azerbaijan, April 10. The inflation rate in Central Asia in 2023 is expected to remain elevated, Trend reports via the WB's Europe and Central Asia Economic Update.
According to the report, this is despite monetary tightening, reflecting strong external influences, earlier currency depreciation and weak monetary policy.
"The central banks in Kazakhstan and the Kyrgyz Republic have hiked rates by 700 basis points and 500 basis points, respectively, since the start of 2022. In Kazakhstan, inflation has continued to rise in 2023, reaching 21.3 percent by February 2023," the report said.
On the contrary, the Central Bank of Uzbekistan raised interest rates by 100 basis points in total in 2022 (reflecting a 300 basis point increase earlier this year and a decline in July), with 12-month inflation falling to 11.9 percent in February 2023.
"Given weak monetary transmission mechanisms and high dollarization, efforts to reduce inflation on the monetary side need to be complemented by efforts on the fiscal side," the report added.
Thus, according to the WB's outlook, the inflation rate in Uzbekistan is expected to stand at 11.8 percent in 2023, in Kazakhstan - at 9.2 percent, in Tajikistan - at 5.6 percent, and Kyrgyzstan - at 8 percent.
The data on Turkmenistan is not reflected in the report.