On October 27, 2025, the Board of the National Bank of Kyrgyzstan decided to increase the key interest rate by 75 basis points, raising it to 10%. This change will take effect on October 28, 2025.
According to information from the regulator, the inflation rate in the country at the beginning of 2025 reached 6.2%, and on a year-on-year basis, it was 8.4%. The structure of consumer prices shows a shift in inflationary pressure from food products to non-food items, which is related to changes in the external economic environment. The inflation rate in Kyrgyzstan is influenced by the limited supply of energy resources in international markets and rising costs in certain service sectors, alongside sustained consumer demand.
The economy of the Kyrgyz Republic is demonstrating high growth rates, which are associated with increased consumer and investment activity. Over the nine months of 2025, real GDP increased by 10%. Investments in fixed capital grew due to the expansion of domestic funding sources, which, in turn, contributed to the active development of the construction sector. Rising incomes, including due to active fiscal policy and growth in remittances from abroad, remain key factors for domestic demand.
Monetary policy, in general, supports macroeconomic stability. The domestic currency market remains stable, and interest rates in the money market provide a balance between the attractiveness of savings and the accessibility of loans. The banking sector maintains its resilience to external risks and has a high level of liquidity in the national currency, creating opportunities for increased lending.
The external environment is characterized by high uncertainty caused by geopolitical risks, changes in global trade rules, and fragmentation of the global economy. These factors lead to fluctuations in global prices for energy resources and food, which, in turn, affect domestic prices. Increased consumer demand and planned changes in tariff policy are assessed as having a moderate impact on the inflation rate; however, external circumstances create instability for inflation forecasts in the near term, requiring a more cautious approach to monetary policy.
Taking into account the assessment of both external and internal factors, as well as focusing on the prospects of monetary policy, the National Bank decided to raise the interest rate to 10%. This decision aims to shape price dynamics in the medium term within the target range of 5-7%.
The National Bank adheres to a balanced approach in its monetary policy, continuing to analyze both external and internal factors of inflation. In the event of risks to price stability, the possibility of adjusting monetary policy is not excluded.
The next scheduled meeting of the Board of the National Bank, where the interest rate will be considered, is planned for November 24, 2025.
