Uzbekistan UZB

Executive summary

Uzbekistan’s macro environment remains solid but faces several challenges that portfolio managers should monitor closely. With a composite score of 62, the country sits above its Central Asian peers (average 54.6) and ranks first in the region for overall credibility. However, the central bank’s credibility gap stands at an alarming 81.7, signaling widening divergence between policy signals and market expectations. Inflation remains persistently above target—CPI is 7.3% versus a 5.0% goal—creating pressure on real incomes and requiring potential tightening. While no current policy rate data are available, the high inflation gap suggests that the Central Bank may need to consider higher rates or additional tools in the near term. Geopolitical risks have risen moderately (score 50.4), highlighted by a series of violent incidents—including a liquefied gas station explosion that killed six and injured five—and other infrastructure accidents that could destabilise public confidence. In sum, the market should anticipate tighter policy measures, weigh inflation‑risk premiums on bonds, and remain vigilant for spill‑over effects from recent security events.

Peer context

Rank 1/2 in Central Asia · 100th percentile

Region avg 54.5 · best 62.0 · worst 47.0