The recent review of the Central Bank's monetary policy indicates that fluctuations in the prices of fruits and vegetables may be influenced by the severity of the water shortage problem in the region.
In the first half of 2023, external inflationary risks have eased, leading to a decrease in inflationary effects on imported goods. However, high budget expenses, growth in real incomes across all sectors, and a thriving retail credit market are expected to continue stimulating consumer demand in the second half of the year.
Conversely, the supply disruptions of food products have not been completely resolved, and the robust consumption demand in the economy is more pronounced in the inflation of essential food items and services. The water shortage issue in the region also contributes to significant fluctuations in the prices of fruits and vegetables.
Forecasts predict that the inflation rate is likely to range from 8.5% to 9.5% by the end of the year. Achieving stable general inflation within this range requires a reduction in the base inflation level from 7.5% to 8.5% by year-end.
Furthermore, the gross domestic product (GDP) of Uzbekistan is projected to experience real growth of approximately 5% to 6% by the end of the year. International financial organizations have also revised their growth forecasts for the country, considering the current economic conditions.
The International Monetary Fund and the World Bank's June forecasts state that the economy of Uzbekistan is expected to grow by 5.1% in 2023 and 5.4% in 2024. The country's foreign trade practices are anticipated to remain stable in 2023, with export volumes (excluding gold) projected to grow by 10% to 15% and import volumes by 12% to 17%.
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