Mongolia’s Inflation Hits Year-High 13.4% in October
In October 2026, Mongolia's annual inflation increased to 13.4%, up from 12.9% in September and 9.2% in October 2025. This is 5.4 percentage points above the Bank of Mongolia's (BoM) 8% upper bound, marking its highest level this year. Consumer prices also rose 1.1% month-on-month, indicating that inflationary pressures remain elevated.
Food, beverages, and water accounted for 5.4 percentage points (40.1%) of annual inflation, followed by transport at 2.8 percentage points (21.1%). Meat prices remained a major source of domestic price pressure, rising 44.4% year-on-year. Beef prices increased 46.2%, while mutton and goat meat rose 55.2%. Transport prices, meanwhile, climbed 4.2% month-on-month, the main driver of October's monthly price increase.
Price pressures extend beyond food and transport. Imported goods, excluding petrol and fuel, recorded a 16.0% annual increase. While domestically produced goods, excluding meat and solid fuels, rose 32.8%. Imported goods (excluding fuel) contributed 2.1 percentage points to headline inflation, compared with 4.4 percentage points from domestic goods. With imported products representing 55.3% of the national consumer basket, external price movements remain an important channel through which inflation affects domestic consumers.
The latest figures suggest that the BoM has limited room to ease monetary policy as inflation proceeds to exceed its target range. The central bank raised its policy rate to 12.5% in August 2026 as price pressures persisted. Its recent decision to relax consumer loan restructuring rules also points to growing household debt stress.
If inflation remains above target, the BoM may have to maintain tight monetary conditions for longer, keeping borrowing costs high. This comes as Parliament approaches the final approval of the 2027 budget, with proposed spending increases that may add to domestic demand and complicate the BoM's efforts to bring inflation down to its target.
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