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Mongolia’s Parliament has approved the “Main Directions of the State Monetary Policy for 2026”, outlining the central objectives of the Bank of Mongolia (BoM) for maintaining macroeconomic and financial stability in the year ahead.
Under the new framework, the Bank of Mongolia will implement policies aimed at stabilizing inflation around 5% ±2 percentage points in the medium term, while supporting sustainable economic growth and protecting household income. The current inflation target of 6% will be gradually reduced to 5% starting in 2027.
Monetary and Macroprudential Policy Goals
- Maintain price stability through market-based monetary policy, focusing on medium-term inflation control.
- Combine macroprudential and monetary tools to assess and manage systemic financial risks.
- Preserve a flexible exchange rate regime consistent with Mongolia’s macroeconomic fundamentals.
- Enhance policy communication and transparency to manage public expectations effectively.
Banking Sector Stability
- Strengthen banks’ capital structure and risk resilience to align prudential ratios with international supervisory standards.
- Update the national anti–money laundering and counter–terrorism financing (AML/CFT) strategy, based on recent risk assessments and FATF recommendations.
- Promote financial literacy to improve public understanding of banking and financial stability.
Financial Infrastructure and Innovation
- Modernize the legal framework for the national payment system, supporting digital transformation and exploring the feasibility of using stablecoins as a payment instrument under international principles.
- Continue banking sector legal reforms, assessing implementation impacts and drafting new legislation where necessary. This includes establishing a legal basis for specialized asset management institutions to reduce non-performing loans.
- Improve business loan accessibility by reviewing credit conditions, tailoring lending products to sectoral needs, and developing medium-term measures to support small and medium enterprises.
According to the Bank of Mongolia, the 2026 monetary policy will focus on ensuring macroeconomic and financial stability amid global shifts in digital finance, international trade, and monetary systems.
