Economic Brief: Analysis of Inflationary Pressures in the CAREC Region

This brief analyzes inflationary pressures in the CAREC region to find that an average annual inflation in the CAREC region accelerated from 5.9% in December 2020 to 9.2% in September 2021 with some countries sustaining inflation rates above double digits, such as Kyrgyzstan where the consumer price index (CPI) rose 13.5% year-on-year in September 2021. There is sizable uncertainty about the inflation outlook due to factors such as supply chain disruptions, high commodity prices, increased food prices, soaring housing prices and inflation expectations. She concludes that global inflationary pressures could eventually ease because long-term inflation expectations are well anchored, but the outlook varies markedly and in some developing economies high inflation is likely to last longer mainly affected by factors such as rising food prices and currency depreciation.