Kyrgyzstan is expected to maintain high domestic demand in 2025 and 2026, but inflation is also expected to accelerate. ADB representative Gulnur Keremkulova announced at a presentation.
According to forecasts, private consumption growth will be around 10 percent per year, driven by a steady inflow of remittances, expected wage increases, and continued lending growth.
The elections scheduled for the forecast period may also provide an additional stimulus for increased domestic spending.
Government projects will make a significant contribution to investment growth, which is projected to be around 20 percent per year.
At the same time, inflation is expected to accelerate due to continued growth in domestic demand, rising utility tariffs, and a likely depreciation of the national currency.
After a decline in 2024, inflation is projected to rise to 6 percent in 2025 and 7.8 percent in 2026.
Factors adding to inflationary pressures include strong demand, adjustments in utility tariffs, likely currency depreciation, continued reliance on imports, and increased inflation expectations.
However, improved domestic production of key consumer goods and smooth supply chains are expected to contain further inflation.
In response to anticipated inflationary pressure, the National Bank of the Kyrgyz Republic is expected to maintain a tight monetary policy and remain vigilant regarding inflation developments, likely continuing its interventions in the foreign exchange market.
