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Rising prices for grain, flour may increase inflation expectations in Kyrgyzstan

Inflation in Kyrgyzstan slowed down to 9.2 percent in October, compared with 9.6 percent a month earlier. The Eurasian Development Bank (EDB) reported.

The bank’s economists believe that the decline is due to the withdrawal from calculations of a surge in consumer prices a year earlier. Until February 2024, this factor will help slow down inflation. On the other hand, a faster slowdown will be hampered by pro-inflationary factors that appeared in early autumn 2023.

«The increase in import prices for grain, recorded in September, was translated into prices for flour products on the domestic market. Given the high share of bakery products in the consumer basket, this may increase inflation expectations. We believe that the National Bank will continue to keep the rate at 13 percent to stabilize inflation expectations,» EDB analysts note.