TASHKENT, Uzbekistan, December 22. The International Monetary Fund expects Uzbekistan’s inflation rate to rise to 11 percent by the end of 2024, Trend reports.
The remark was made during a meeting between the mission of the IMF in Uzbekistan headed by Yasser Abdih and the representatives of the Uzbek authorities in Tashkent.
During the meeting, the parties discussed prospects of Uzbek economic development, as well as IMF’s policy priorities in the country.
The IMF noted the commitment of the Central Bank of Uzbekistan (CBU) to keep monetary policy relatively tightened until inflation slows clearly to target values, and to raise the rate if core inflation unexpectedly rises.
“Efforts to strengthen the transmission of monetary policy, which remains limited by low levels of financial intermediation, high dollarization and still significant political lending, must continue. The flexibility of the exchange rate is important to absorb possible impacts and ensure the safety of reserves,” the Fund noted.
Furthermore, the Fund’s analysts stressed that Uzbekistan’s monetary policy should remain tightened to continue reducing inflation.
“It is expected that the necessary increase in the administered energy prices will put pressure on inflation. However, this effect will be mitigated by continued tighter monetary policy and significant fiscal consolidation,” the mission representatives said.
Earlier this year, Uzbekistan recorded a decrease in inflation rates from January through June, which was the lowest rate in the last 5 years. As per data from the Center for Economic Research and Reforms (CERR), during this period, prices in the country increased by 3.5 percent, while the number for the same period in 2022 amounted to 6.5 percent.