As noted in the statement,

«external conditions continue to be the main factor determining price dynamics in the republic.»

«For a small, open economy, changes in the external environment are quickly transmitted to the domestic market through increased import costs and production costs. Ongoing geopolitical tensions in the world, including the conflict in the Middle East, and the associated price fluctuations on global commodity markets impact the cost of goods imported into the country,» the National Bank of the Kyrgyz Republic noted.

Since the beginning of 2026, consumer prices in Kyrgyzstan have increased by 7.3 percent, and the annual inflation rate reached 11.7 percent.

«In recent months, one of the most noticeable channels of external influence transmission has been the rise in fuel and lubricant prices, which is reflected in transportation and production costs in the country, and the rise in food prices due to high price volatility in global food markets. Thus, domestic prices for food products have increased by 6.3 percent since the beginning of the year, and for non-food products by 5.8 percent. Internal factors are influencing price dynamics in the service sector, which have increased by 11.1 percent,» the National Bank reported.

Economic activity in the republic remains strong—real GDP growth amounted to 11.1 percent in January—July 2026. This growth is supported by robust investment activity, primarily in construction, and rising domestic consumption. Rising household incomes and expanded lending support consumption and foster sustainable domestic demand.

The discount rate is a key instrument of the country’s central bank’s monetary policy, determining the cost of short-term borrowing for commercial banks. It influences the overall cost of credit in the economy and lending conditions for businesses and households.

«Supported monetary conditions minimize the impact of external inflationary risks and ensure the purchasing power of the national currency. The National Bank actively regulates excess liquidity in the banking system, limiting the monetary contribution to inflation. Previously adopted monetary decisions and tactical measures contribute to the formation of short-term money market rates, including the BIR rate, within the interest rate collar and close to the National Bank’s policy rate,» the statement reads.

Continuing external inflationary risks require maintaining tight monetary conditions. National Bank of the Kyrgyz Republic

Continuing external inflationary risks require maintaining tight monetary conditions.

«The cumulative effect of previously adopted decisions on the National Bank’s policy rate and measures to regulate the money supply in the economy continue to limit internal sources of price growth. Under these conditions, the current decision to maintain the National Bank’s policy rate will help limit the secondary effects of inflation from external factors and create the preconditions for a sustainable reduction in inflation in the medium term,» the regulator believes.

«The National Bank adheres to a balanced approach in conducting monetary policy and continues to assess the emerging external and internal factors of inflation. If any risks to price stability arise, the National Bank does not rule out the possibility of making adjustments to its monetary policy,» the National Bank of the Kyrgyz Republic noted.

The next meeting of the National Bank’s Board to discuss the discount rate will be held on October 26, 2026.