November 26, 2019 / 8:30 AM / 3 months ago

Uzbekistan central bank says rate cut possible next year

TASHKENT, Nov 26 (Reuters) - Uzbekistan’s central bank may consider cutting its policy rate in six months’ time as it switches to inflation targeting next year, central bank governor Mamarizo Nurmuratov said on Tuesday.

The Central Asian nation’s central bank last changed its refinancing rate in September 2018, hiking it to 16% from 14%. Uzbekistan has passed a new central bank law this month directing the bank to focus on price stability.

Nurmuratov said the central bank aimed to curb inflation, seen at 15.5% this year, to 12-13.5% in 2020 and then keep it below 10% in 2021 and below 5% in 2023.

However, there could be room for policy easing as soon as next year, he said, as the central bank plans to make the refinancing rate more relevant by introducing open market operations and scrapping the policy of providing subsidised loans at lower rates.

“God willing, we will lower it in six months when we implement the roadmap on inflation targeting approved by the president,” Nurmuratov told a briefing.

The bank will start offering overnight and one-week deposits and loans next year, he said. (Reporting by Mukhammadsharif Mamatkulov; Writing by Olzhas Auyezov; Editing by Alison Williams)

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