The inflation rate is gradually stabilizing and approaching the target

Following the relative growth in the first half of 2017, inflation, as expected, returns to its stable trend. In August, the level of monthly inflation developed with a lower than expected -0.3%, which is 1.1 percentage points less compared to the same period last year.

It should be noted that this indicator, being the lowest for the last nine years, is due to the reduction and stabilization of prices for food products, especially the growth of fruit and vegetable products supply, as well as anti-inflationary monetary policy, stable situation in domestic foreign exchange market and national currency rate.

At the same time, annual inflation in August decreased to 7.7%, from 8.9% in July, and is gradually approaching the middle of the medium-term milestones (7% ± 3) of the National Bank of Tajikistan.

It is worth to note that contribution of food products to annual inflation (5.8 percentage points) remains still significant, mainly due to the significant influence of seasonal factors and supply factors, in particular the decline in production and low supply of certain types of food products in the first half of the year. Earlier, the above mentioned factors were also the reasons for the output of inflation from the target level.

However, in general, the influence of these factors is of temporary nature. According to forecasts, it is expected that the inflation rate in the current year will be kept within the target.

The National Bank of Tajikistan conducts monetary policy on the principles of transparency and predictability through the use of monetary and foreign exchange instruments, primarily refinancing rates for regulating the money supply and its price, minimizing inflation pressures and achieving the inflation target in the medium term.

Inflation forecast for the medium-term period, % per annum