BAKU, Azerbaijan, December 26. Inflation has been well-contained in Tajikistan despite higher international commodity prices during 2022, Trend reports citing the International Monetary Fund (IMF).
The IMF notes that the annual inflation rate in Tajikistan decreased from 8 percent at end-2021 to 4.5 percent in November 2022, which is below the mid-point of the National Bank of Tajikistan’s medium-term target range of 6 (±2) percent.
"A tight monetary stance has helped contain inflationary pressures while rising international prices for imported food and fuel in the first half of the year appear to have been mitigated by a stronger somoni and the release of strategic food reserves," the message said.
According to the IMF, the National Bank of Tajikistan (NBT) should stand ready to tighten the monetary policy stance if inflationary pressures emerge, despite the fact that inflation in Tajikistan remains well-contained.
"The monetary stance remains relatively tight despite the reduction in the policy rate in October, with real interest rates close to 8 percent (using realized inflation). Nevertheless, monetary aggregates have increased sharply due to strong financial inflows. This appears to partly reflect stronger demand for somoni, but the NBT should stand ready to tighten the monetary stance if needed to prevent a de-anchoring of inflation expectations. Quantitative measures such as raising the reserve requirement and sterilizing inflows through NBT bill and ruble auctions can help absorb excess liquidity," the IMF underlined.