OREANDA-NEWS. The seventh traditional Expert Forum held on the 14th of May in Bishkek was organized by the National Bank of the Kyrgyz Republic, with the participation of Deputy Chairman (vice-president) of the National Bank Abdybaly Tegin Suerkul, heads of the National Bank branches, experts from the banking sector, international organizations and academic circles.

The results of the National Bank monetary policy for the Ist quarter 2013 were on the agenda. During the opening ceremony, Abdybaly S. referred to the participants with an offer to take an active part in the discussion, consider comments and recommendations, provided during the forum, which will be considered in the development of the monetary policy.

The chief of the Economic Department of the NBKR Seyilbek Urustemov briefly informed about the current economic situation in the country, prognosis’ of the monetary policy conducted by NBKR and its trend in the future. According to him, after the 1st quarter of 2013 there was an increase in GDP by 7,6%. The improvement of the economy is connected, mainly, with the recovery of mining works at "Kumtor". According to the preliminary data for January-April the country’s GDP increased by 8,2%. It was noted during the speech, that domestic demand, largely, is based on flow of remittances from abroad. It was also higlighted that the increase of the remittances is continuous, but the rates were decreased a bit. Experts noted that this circumstance come out from the decreasing rate of Russia's economy, which is target country for labour migrants from Kyrgyzstan.

Regarding the trends of the monetary policy from the beginning of the year, he noted that in the 1st quarter the National Bank didn’t carry out the currency intervention on the Interbank Foreign Exchange Market, but in April sales operations were amounted in USD 14.7 million.

At the end of last year, NBKR introduced mechanism of credit auctions for refinancing up to 6 months. This will provide flexibility to the banks in liquidity management, so that they can increase the amount of funds allocated for crediting economy’s real sector. At present, the volume of placements by means of credit auctions makes up 132 million KGS.

"NBKR monetary policy aimed at limiting the monetary component, taking into account the high non-food inflation. This year, according to experts, will be good for harvesting grain crops. On world markets index of food prices remained unchanged, except for rising prices of dairy products. According to the results of the 1st quarter, the annual inflation rate was 7.8%. According to the current evaluation, and with conditions that there will be no shocks, the rate of inflation could make up around 7% by the end of 2013"- said S.Urustemov.

The main challenges of the domestic economy this year indicated the potential limitations in the resource side of the budget, including the uncertainty of the situation around Kumtor, as well as the deterioration of the global economy. In particular, the slowdown in the economies of countries - major trade partners of Kyrgyzstan, the decline in external demand. He stressed that this is the key risks that should be followed up.

The majority participants of the forum recommended that the National Bank continues to pursue a tight monetary policy to curb inflation temps, it was also recommended to strengthen the mechanism of refinancing the loan. It was proposed to improve the coordination of the Central Bank with the government and other state agencies, as well as to study in details the role of a financial advisor at this stage.

Expert Forum of National Bank is normally held once in a quarter. Its main purpose is development of recommendations by independent economists aimed at ensuring macroeconomic stability in the country, on the basis of discussions of current economic topics with emphasis on monetary policy at the experts platform.