Skip to playerSkip to main content
  • 2 hours ago
Central banks face new credibility test over rate cuts

Economists at the Tashkent Monetary Policy Dialogue warned that premature rate cuts could keep inflation above target. Uzbekistan’s lower inflation, falling expectations and reduced dollarisation show how credibility shapes monetary policy.

READ MORE : http://www.euronews.com/2026/07/09/central-banks-face-new-credibility-test-over-rate-cuts

Subscribe to our channel. Euronews is available on Dailymotion in 12 languages

Category

🗞
News
Transcript
00:02Central banks are entering a more complicated phase after years of high inflation.
00:07Policymakers are weighing the timing of interest rate cuts,
00:10the need to keep inflation expectations under control,
00:12and the use of new digital tools without weakening financial stability.
00:16That agenda brought central bankers, economists and international financial institutions
00:21to Tashkent for the first Monetary Policy Dialogue Forum.
00:24There have been repeatedly shocks for the last five years,
00:29and that is why lessons learned from the shocks and experience
00:35and sharing of experience is absolutely very important.
00:39The first pressure point is the path of interest rates.
00:42After the inflation surge of recent years, the pace of any cuts remains a delicate call.
00:47The risk, I fear, remains that for many central banks,
00:53policy easing is contemplated too early.
00:56But the discussion went beyond interest rates.
00:59For central banks, credibility depends on keeping inflation expectations
01:03anchored when new shocks hit the economy.
01:05In Tashkent, inflation targeting was presented as one way to protect price stability
01:10in a less predictable world.
01:12A framework that works very well, in my view, is inflation targeting.
01:17By focusing on stabilizing inflation and maintaining price stability,
01:23central banks simply provide the foundation for all of the other adjustments
01:28that need to take place when shocks hit the economy.
01:31For Uzbekistan, the discussion has a practical dimension.
01:34The country is still moving towards full-fledged inflation targeting
01:38as part of broader market reforms.
01:40Figures presented at the forum show the inflation falling from nearly 20% in 2018
01:45to 5.5% in May 2026.
01:49Inflation expectations have also declined from an average of 20% to about 10%.
01:54On the central bank side, we will continue our tight monetary conditions
01:58to achieve the inflation target, to build high credibility for monetary policy.
02:04From inflation targeting towards official intelligence, the challenges facing the world's central banks are global
02:10and the answers will have to be two.
02:12That's why governors, economists and policy makers gathered here in Tashkent.
02:16Roshan Rahmatullaeva, Euronews.
02:19Roshan Rahmatullaeva.
02:20Roshan Rahmatullaeva, Euronews.
02:21Roshan Rahmatullaeva, Euronews.
Comments

Recommended