Page 10 - Uzbek Outlook 2022

IntelliNews that even 10% was a rather high figure, but such price growth was not an Uzbek phenomenon
as, amid the pandemic, inflation had gained momentum worldwide.

“Inflation in Uzbekistan is slightly lower this year than in previous years. There is a long-term downward
trend, which is very good. But in general, it still remains high. This is a serious headache for the
population. Especially if we are talking about food, basic necessities. People who live on a pension or on
a single salary, or even three salaries, they are forced to work from morning to evening. For them, inflation
is a very serious blow to their pocket,” said Livny.

The introduction of inflation targeting is now the main focus of the Central Bank of Uzbekistan (CBU),
which has been trying to anchor the population’s expectations for price rises.

After the centralised controls on the economy were eased in the first quarter of 2020, inflation fell. It
declined from a steady 15.5% to reach a low of 7.3% in October 2021. That allowed the CBU to make a
series of rate cuts.

Nevertheless, the basic problem the central bank faces is that having lived through decades of economic
chaos, the population has little confidence in the regulator, thus the inflation expectations of the population
and businesses have never been anchored. Expectations for price rises remain significantly higher than
those seen in CBU forecasts, which is in itself inflationary.

10 Uzbekistan Outlook 2022 www.intellinews.com