POLICY RATE MAINTAINED AT 12.5 PERCENT

 

The Bank of Mongolia’s Monetary Policy Committee met on September 16–17, 2026, and decided to maintain the policy rate at 12.5 percent, following its assessment of macroeconomic conditions, inflation, and financial sector risks.

In August, annual inflation eased to 12.5 percent nationwide and 11.6 percent in Ulaanbaatar, while core inflation stood at 6.8 percent. Increased food supply supported the decline, although pressures from fuel and energy prices, wage growth, and fiscal spending remain.

Maintaining the policy rate aims to contain inflationary pressures without further tightening financial conditions. The high interest rate environment continues to influence borrowing costs, bond yields, investment decisions, and project financing.

Mongolia’s economy grew by 7.7 percent in the first half of 2026, while real household consumption contracted by 4.9 percent in Q2. Official foreign exchange reserves reached USD 8.36 billion.

UBIM is working to diversify funding sources for municipal projects and expand capital market financing. Monetary policy, market interest rates, and inflation therefore remain key considerations in financing structures, funding costs, and investment decisions.