BoB expects temporary drop in inflation

The central bank has a medium term objective range for inflation of three to six percent, which it considers conducive for economic growth and stability in the country. However, inflation was last within the objective range in April 2021, as the impact of increases in various taxes and levies, as well as frequent hikes in administered prices such as fuel, have pushed the cost of living to 14-year peaks.

Projections shared by the BoB on Friday, however, point to reduction in the pace of inflation in the third quarter of this year. The BoB expects that inflation will revert to the three to six percent range by the second quarter of next year.