Inflation expectations of households and enterprises
Inflation expectations are an important indicator reflecting the expectations of the population, business entities and financial market participants regarding future price changes. They have a significant impact on current inflation, wage levels, consumer and investment activity.
Entrepreneurs set prices for their products based on inflation expectations. In case of expecting inflation to accelerate, they may raise prices in advance to offset future costs associated with price changes.
In addition, workers' concerns about accelerating price increases are reflected in their increased demands for wage increases. This leads to increased labor costs for employers and higher prices of final products.
On the demand side, consumers, fearing future price increases, may purchase goods in advance to meet their future needs. As a result, the demand exceeding the current need is formed, which also contributes to price increase.
The Central Bank of the Republic of Uzbekistan within the framework of monetary policy development pays special attention to the study and analysis of inflation expectations of the population and entrepreneurs, as well as their stabilization around the target inflation rate of 5 percent.
