Central Bank says 5% inflation target remains within reach by 2027

Responding to inquiries from Senator Ikromkhon Najmiddinov regarding previous adjustments to the inflation timeline, Ishmetov acknowledged that target deadlines had been revised multiple times in recent years. He explained that inflation dynamics remain highly sensitive to shifting macro-economic conditions, requiring the bank to update its forecasts whenever the broader economic environment changes.

The ongoing phased liberalization of energy tariffs, which began in 2024, stands out as a significant driver of recent price changes. However, Ishmetov pointed out that two other internal structural factors continue to keep inflation elevated.

The primary domestic pressures stem from aggregate demand consistently outstripping the economy's actual production capacity, alongside public spending that regularly exceeds initial budget forecasts. Central Bank data indicates that growth in household incomes and the overall money supply continues to outpace the domestic supply and production of goods, sustaining upward pressure on prices. Excess fiscal spending further compounds these inflationary risks.

On the international front, external complications include geopolitical tensions, volatile global food and fuel prices, and rising logistics and transportation costs.

Despite these challenges, the Central Bank chief reassured lawmakers that current economic models have already factored in these variables. The regulator remains confident in its trajectory, noting that unless actual conditions deviate drastically from expectations, the path toward the 5% threshold remains clear.

The statement comes on the heels of positive price data from May 2026, which saw annual inflation slow down to 5.5%. This deceleration was largely a technical result of the high-base effect from energy pricing schedules. While utility tariffs for electricity and natural gas were raised on 1 May last year, the corresponding price adjustments for the current year were deferred until 1 June, temporarily easing annual price comparisons.