Bishkek, Jan. 26, 2021 / Kabar /. The National Bank of Kyrgyzstan has kept the discount rate at 5%, the bank reported.
The spread of the COVID-19 pandemic in the world, the volatility of world prices in commodity markets and the heterogeneity of the development of the world economy continue to negatively affect the development of the countries of the region and the economy of the Kyrgyz Republic, in particular, the National Bank said.
“Economic activity in Kyrgyzstan remains low. A significant decline in production volumes is observed in almost all sectors of the economy, except for agriculture. The Kyrgyz economy’s positive sustainable growth rates will largely depend on the epidemiological situation in the country and the speed of recovery of the economies of the trading partner countries.
Prices for certain goods in the world food and commodity markets are growing. The cost of oilseeds and sugar in the countries supplying these goods to Kyrgyzstan is also showing steady growth. This factor, together with the continued high demand for domestic meat products in neighboring countries, determines the current growth in the general price level in the country. The annual inflation rate in January 2021 (as of the 15th) was 9.9 percent. The planned increase in excise taxes on alcohol and tobacco products in the first quarter of 2021 will be an additional factor in the upward dynamics of inflation throughout the year. In the current economic conditions, after some acceleration, inflation by the middle of the year will stabilize somewhat and by the end of the year it will be within single-digit values,” the report said.