The National Bank raised the discount rate to 12%

The Board of the National Bank decided to raise the discount rate (key rate) by 100 basis points to 12%. The decision will take effect on February 24, 2026.

The external economic environment remains heterogeneous and characterized by heightened uncertainty. Global food markets are seeing a gradual slowdown in the growth of prices for basic commodities, but inflation in Kyrgyzstan's main trading partner countries remains high. Given the significant share of imports in the consumer basket, domestic prices remain sensitive to changes in the external environment. The outlook for further price dynamics largely depends on the stability of global supply chains and trade flows, which remain at risk amid geopolitical tensions and fragmentation of the global economy. Such conditions require maintaining a balanced approach to monetary policy to ensure price stability in the Kyrgyz Republic.

Inflation in Kyrgyzstan from the beginning of 2026 as of February 13 was 1.8% (9.6% in annual terms). Price dynamics are generally developing within the expected trajectory, while maintaining uneven dynamics for the main components of the consumer basket. Food prices are showing moderate growth rates due to the stabilization of prices for certain products. At the same time, price dynamics remain elevated in the services and non-food goods sectors as a result of both the secondary effects of external conditions and the strengthening of internal demand factors.

The Kyrgyz economy continues to grow at a rapid pace. In January 2026, the country's real GDP grew by 9%. As before, the acceleration of economic activity was observed in the services and construction sectors. Investment in fixed capital remains high, supporting the expansion of infrastructure projects. At the same time, growth in real household income and the expansion of consumer lending are supporting domestic demand. Taken together, these factors are creating additional pro-inflationary momentum.

Monetary conditions continue to support the purchasing power of the national currency and create conditions for price stability within the target range of 5-7% in the medium term.
The interbank money market is functioning stably, with the BIR rate forming near the lower limit of the National Bank's interest rate corridor, reflecting the balance of supply and demand for short-term money market resources amid excess liquidity in the banking system. The domestic currency market remains stable. Currency interventions are carried out exclusively to smooth out sharp fluctuations in the exchange rate.

The banking sector is showing stability. The volume of the banks' deposit base in 2025 grew by 46.2% to 865.9 billion KGS, reflecting confidence in the banking system and increased savings behavior among the population. The loan portfolio of commercial banks increased by 48.8% in 2025 to 507 billion KGS, reflecting the activity of the real sector of the economy.

The medium-term inflation trajectory will be determined by the balance of external and internal conditions. Against the backdrop of pro-inflationary factors in the economy, including as a result of the expansion of the positive fiscal impulse, the widening of the GDP gap, and the growth of consumer demand, it is necessary today to tighten monetary conditions in order to create sustainable conditions for slowing inflation. In this regard, the National Bank's discount rate has been raised to 12%.

The National Bank adheres to a balanced approach in conducting monetary policy and continues to assess emerging external and internal inflationary factors. In the event of any risks to price stability, the National Bank does not rule out the possibility of making adjustments to its monetary policy.

The next scheduled meeting of the National Bank's Board on the discount rate will take place on April 27, 2026.