Key insights
- Uzbekistan's central bank held rates but signaled potential tightening due to persistent inflation and rising external risks, particularly from geopolitical tensions impacting energy and food prices. This highlights the challenges faced by emerging markets in controlling inflation amid global uncertainties, potentially impacting investor sentiment towards risk assets.
Investing.com -- Uzbekistan’s central bank kept its policy rate unchanged at 14.00% on Wednesday but adopted a more hawkish stance as inflation pressures persist and external risks mount.
The Central Bank of the Republic of Uzbekistan acknowledged that the disinflation process has stalled, with headline consumer price inflation holding steady at 7.3% year-over-year in February. Core inflation accelerated to 6.3% year-over-year from 5.7% in December 2025.
The bank said inflation expectations are now persistently elevated rather than stabilizing. The external environment is increasingly seen as pro-inflationary, as geopolitical tensions push up global energy and food prices.
Rising risks of imported inflation combined with strong domestic demand suggest restrictive rates may need to remain in place for longer, the central bank said.
The March statement marked a shift from January’s conditional easing language. The bank now explicitly states that policy may be tightened further should risks materialize.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.