Inflation in plain words
Inflation is the gradual rise in prices of goods and services. When prices rise, the same amount of money buys less. Bread, bus fares, rent, medicine — they don't all get pricier at once or at the same pace, but on average prices go up over a year.
Inflation is measured with the consumer price index: statisticians track the prices of a "basket" of typical goods and services every month and compare them with a year earlier. If annual inflation is 6%, something that cost 100,000 so‘m a year ago now costs about 106,000 on average.
Why prices rise
Inflation usually has several causes acting at once:
- Demand grows faster than supply. When people and firms have more money (wages, loans, remittances) but the same amount of goods, sellers raise prices.
- Costs go up. Higher energy, fuel, transport and raw-material costs feed into final prices.
- The exchange rate moves. Many goods are imported or made from imported parts. If the so‘m weakens, they get pricier.
- Expectations. If everyone expects prices to rise, sellers raise them early and buyers rush to buy — and the expectation comes true.
Low, predictable inflation is normal in a growing economy. The problem is when it's high or jumpy: then planning and saving get hard.
What inflation is in Uzbekistan right now
According to the Central Bank, annual inflation in Uzbekistan was 6.2% in August 2026. At the start of the year it was slightly above 7%, so price growth is gradually slowing. The Central Bank's target is 5%.
To fight inflation the Central Bank uses its policy rate — the rate that bank loan and deposit rates depend on. At its meeting on 16 September 2026 it was kept at 14% per year.
These figures are updated monthly, and the rate is reviewed several times a year. Always check current values on cbu.uz.
Why this matters to you personally
The main effect of inflation is simple: money that just sits there loses value. Here's what happens to 10,000,000 so‘m in cash if inflation stays around 6% a year:
| After | Worth in today's money |
|---|---|
| 1 year | about 9,430,000 so‘m |
| 3 years | about 8,400,000 so‘m |
| 5 years | about 7,470,000 so‘m |
The notes in the envelope are the same, but in five years they lose about a quarter of their purchasing power. Nobody took your money — everything around simply got more expensive.
Personal inflation
The official figure is a national average. Your personal inflation may be higher or lower. If most of your budget goes on rent, food or medicine and those rise faster than average, you'll feel it more. It's worth comparing what you actually pay for the same things every six months — for example, in your expense tracker.
Nominal vs real return
When a bank offers 18% on a deposit, that is the nominal return — how much the balance grows. What matters to you is how much you can buy with it. That is the real return — the return after inflation.
Quick formula:
Real return ≈ deposit rate − inflation
Exact formula: (1 + rate) ÷ (1 + inflation) − 1. For small numbers the difference is minor; simple subtraction is fine for an estimate.
A deposit example
Say you put 10,000,000 so‘m into a one-year deposit at an illustrative 18% (an example rate — check actual rates with banks), and inflation that year is 6.2%.
- After a year the balance is 11,800,000 so‘m. Nominal income: 1,800,000.
- In today's prices: 11,800,000 ÷ 1.062 ≈ 11,111,000 so‘m.
- Real return: about 11%. Your purchasing power really grew.
When a deposit loses to inflation
Now suppose savings sit on a card paying 5% a year. With 6.2% inflation, the real return is about −1%. The balance grows, but purchasing power slowly shrinks.
| Where the money is | Rate | Inflation | Real return |
|---|---|---|---|
| Cash at home | 0% | 6.2% | about −5.8% |
| Low-interest card | 5% | 6.2% | about −1.1% |
| So‘m deposit (example) | 18% | 6.2% | about +11.1% |
Inflation, salary and debts
- Salary. If your pay rose 5% in a year but prices rose 6%, you're actually earning a bit less. Compare raises with inflation.
- Fixed-rate loans. The payment stays the same while income usually grows, so the loan gradually feels lighter. That's no reason to borrow: consumer loan rates are usually well above inflation.
- Lending to relatives in so‘m. Lend 5,000,000 so‘m interest-free for three years and you get the same amount back, but it buys less.
Checklist: comparing a deposit with inflation
- Find current inflation on cbu.uz (the year-on-year figure).
- Check the deposit rate and make sure it's annual, not "for the whole term".
- Subtract inflation. If the result is positive, the deposit protects your money.
- Read the conditions. If early withdrawal recalculates interest at a minimal rate, the real return may turn negative.
- Mind the currency. Dollar deposits usually pay less, and the outcome depends on the so‘m exchange rate. That's a separate risk — don't bet all your savings on one currency.
How to keep inflation from overtaking you
- Don't keep large sums in cash. Only a small reserve at home.
- Keep your emergency fund in a deposit or savings account that allows withdrawals.
- For 1–3 year goals, fixed-rate so‘m term deposits work well.
- For 5+ year goals, you can learn about investing — but only after building a cushion and clearing expensive debt.
- Grow your income. The most reliable inflation hedge is skills and pay that rise faster than prices.
What not to do
- Don't spend all your savings stockpiling goods out of fear of price rises — most things lose value.
- Don't trust offers to "protect your money from inflation" at 5–10% a month. That's a classic pyramid scheme.
- Don't take a loan "before prices go up" without fitting the payment into your budget.
Next step
Open the deposit comparison on ONPUL and see what rates banks offer right now. Subtract current inflation — and you'll instantly see where money truly grows and where it just stands still.