<img src="https://img.day.az/2024/05/04/800×550/adb_headquarters.jpg" class="article-image" alt="ADB lowers inflation forecast for the Caucasus and Central Asia”/>
The Asian Progress Bank (ADB) has revised its inflation forecasts for the Caucasus and Central Asia subregion,lowering its forecast for 2024 from 6.9% to 6.8% compared to the september 2024 report, while the forecast for 2025 remained unchanged at 6.2%, Day.Az reports with reference to Trend.
The downward revision reflects moderate inflationary pressures in selected countries in the subregion.
“Thanks to prudent monetary policy, inflation in Georgia remained low at 1.1% between January and September 2024. Similarly, in the Kyrgyz Republic, a slowdown in price growth for most categories of goods led to an average annual inflation rate of 4.8% in the frist nine months of the year,” the report says.
ADB experts noted that low global commodity prices had a positive impact on Tajikistan, where inflation for the first three quarters of 2024 was 3.5%, well below the central bank’s target level.
According to the report, inflation forecasts for Azerbaijan, Kazakhstan, Turkmenistan and Uzbekistan remained unchanged.
**What are the implications of the inflation forecast revisions for businesses in the region?**
Interview with Dr. Alexei Ivanov, Economic Consultant at ADB
Q1: Thank you for joining us, Dr. Ivanov. The Asian Progress Bank has recently revised its inflation forecasts for the Caucasus and central asia. Can you explain what prompted this revision?
Dr. Ivanov: Thank you for having me. The revision of the inflation forecast for 2024 from 6.9% to 6.8% reflects a general trend of moderate inflationary pressures across select countries in the region. This positive shift can primarily be attributed to prudent monetary policies adopted by several nations, notably Georgia and the Kyrgyz republic, which have successfully maintained lower inflation rates.
Q2: what specific measures have countries like Georgia taken that have contributed to their low inflation rate?
Dr. Ivanov: In Georgia, a combination of effective monetary policy tools and a commitment to fiscal discipline has played a key role. As a notable example, between January and September 2024, the inflation rate was remarkably low at just 1.1%. These policies helped stabilize prices and reduce fluctuations, creating a conducive habitat for lasting economic growth.
Q3: The report mentioned that Tajikistan experienced a meaningful drop in inflation rates. What factors contributed to this positive trend?
Dr. Ivanov: Tajikistan benefited from low global commodity prices, which eased the burden on consumers and businesses alike. with an average inflation rate of 3.5% during the first three quarters of 2024, this figure was well below the central bank’s target. having access to stable pricing for essential goods is crucial for the country’s economic stability.
Q4: How do inflation forecasts for other countries in the region, like Azerbaijan and Kazakhstan, remain unchanged? What implications does this have for their economies?
Dr. Ivanov: For Azerbaijan, Kazakhstan, turkmenistan, and Uzbekistan, the unchanged forecasts suggest that these countries are facing persistent inflation challenges, likely due to their reliance on commodity exports and the overall economic environment. Stable inflation rates in these countries indicate the need for ongoing monitoring and possibly a reassessment of their monetary policies to foster economic resilience.
Q5: What advice would you offer to businesses operating in the Caucasus and Central Asia given the current inflation trends?
Dr. Ivanov: Businesses should focus on adapting to the current economic climate by implementing strategic pricing strategies and cost management measures. It’s also vital for them to enhance efficiency to counteract any potential inflationary pressures. Additionally, staying informed about global commodity prices can provide valuable insights for better decision-making.
Q6: Looking ahead, what are the potential risks that could affect the inflation outlook for the region?
Dr. Ivanov: While the current forecasts seem stable, potential risks could include geopolitical tensions that affect trade routes, global economic fluctuations, or shifts in commodity prices.Therefore, it’s essential for policymakers and businesses in the region to remain agile and responsive to these risks to mitigate their impacts on inflation and economic growth.
Q7: Lastly, how can readers stay informed about economic developments in the Caucasus and Central Asia?
Dr.Ivanov: Readers can follow reputable sources, such as the ADB reports and local economic bulletins, to stay updated on inflation trends and economic forecasts. Engaging with economic forums and discussions can also provide valuable insights and foster a deeper understanding of the region’s dynamics.
Conclusion: This interview sheds light on the recent inflation forecast adjustments by ADB, emphasizing prudent monetary policies and their positive outcomes in certain countries within the Caucasus and Central Asia. Businesses and policymakers alike should remain vigilant and responsive to shifting economic conditions.