- Decision
- Maintain
- Rate change
- 0 bps
- policy rate
- 14%
The Central Bank of the Republic of Uzbekistan (CBU) kept its policy (key) rate unchanged at 14% per annum at the 24 October 2025 Board meeting, judging that relatively tight monetary conditions are still needed to lock in recent disinflation while guarding against persistent demand-driven and external price pressures. After a 50 bp increase to 14% in March, the CBU has held the rate steady at each subsequent meeting. Liquidity-management operations continue to steer the UZONIA rate near the policy rate (about 13.5% in September) amid a surplus in bank liquidity, supporting the appeal of soum deposits and moderating lending growth. Headline inflation fell to 8% y/y in September from 8.8% in August, core inflation eased to 7%, and the bank now sees year-end inflation around 8% before converging on its 5% target in 2027; GDP expanded 7.6% in Q3 and is projected to end 2025 at 7–7.5%, buoyed by rising real incomes and a 41% y/y surge in credit. The soum has appreciated 6.5% against the USD this year, helped by an 18% rise in export revenues, stronger remittances (USD 13.9 bn, +23% y/y) and net FX sales by banks, while the real effective exchange rate has edged down 1.6%, implying no loss of competitiveness. The Board cited lingering risks from elevated partner-country inflation, possible second-round effects from energy price liberalisation and seasonal supply shocks. It reiterated that monetary conditions will remain “sufficiently tight” and could be adjusted to ensure inflation continues on a steady path toward the 5% target.
Rate evolution
From June 2025 to September 2026, the Central Bank of the Republic of Uzbekistan kept the policy rate at 14%, maintaining a tight stance as inflation slowed only gradually, core and services inflation remained elevated, expectations exceeded actual inflation, and robust demand drew support from credit growth, fiscal spending, remittances, investment and high activity.
By late 2025 and January 2026, it judged disinflation to be broadening as exchange-rate appreciation, lower import-price pressure and tighter monetary conditions pushed core inflation down and led to lower inflation forecasts, but services inflation, retail lending and resilient consumer demand still warranted tight policy, even as it said rate cuts could be considered if inflation and expectations kept falling. In March and April 2026, the Central Bank of the Republic of Uzbekistan said price stabilization had slowed, food-price inflation and producer prices were adding pressure, expectations remained above forecast, growth and aggregate demand had strengthened further, and geopolitical tensions were increasing oil, food, supply-chain and logistics risks, so it kept the policy rate at 14% and said conditions could be tightened further if inflation or expectations threatened progress towards the 5% target. At its 17 June meeting, it again held the rate at 14%, noting that headline inflation had fallen to 5.5% in May as energy-tariff base effects faded, but core inflation was broadly unchanged at 5.7%, domestic demand remained strong, and fiscal spending, the June energy-tariff increase and external food, energy and logistics costs posed further risks. On 29 July, it maintained the rate at 14% as headline inflation accelerated to 6.4% in June following higher regulated energy tariffs and coal price liberalization, core inflation remained at 5.7%, demand continued to grow rapidly, and tariff effects, fiscal spending and external price and supply risks warranted tight conditions despite lower household and business inflation expectations.
On 16 September, it again held the policy rate at 14%, noting that headline inflation had slowed to 6.2% in August and core inflation was around 5.5%, but a growing share of goods and services recorded price increases above 5% and inflation expectations were declining more slowly than headline inflation. Active consumption and investment demand, high global commodity, food and energy prices, transport and logistics costs, and potential second-round effects from regulated-price liberalization warranted continued tight conditions, despite signs of stabilization in some demand components, moderating credit growth and real effective exchange-rate appreciation that eased import-price pressure.