Parliament Approves the Main Guidelines for the State Monetary Policy for 2026

At its plenary session held today (17 October 2025), the State Great Khural (Parliament) discussed and approved the “Main Guidelines for the State Monetary Policy for 2026.”

In accordance with the Guidelines, the Bank of Mongolia will pursue the following objectives in 2026:

Monetary and Macroprudential Policy

• Implement monetary policy based on the market principles to stabilise inflation around a medium-term target of 5 percent (with a ±2 percentage-point band), thereby supporting sustainable economic growth and protecting household incomes. The current inflation target of 6 percent will be reduced to 5 percent starting from 2027.
• Coordinate macroprudential and monetary policies, taking into account macro-financial linkages, to assess and manage potential risks to the financial system.
• Maintain a flexible exchange rate regime that reflects fundamental macroeconomic conditions.
• Strengthen public communication to ensure that the central  bank’s policies and decisions are well understood and to help guide expectations.

Banking Sector Stability

• Continue measures to enhance banks’ capital structure and quality, strengthen the resilience of the banking system, and align prudential indicators and supervisory practices with international standards.
• Update the national Anti-Money Laundering and Counter Tterrorist Financing (AML/CFT) policy based on Mongolia’s risk assessment and the outcomes of the Financial Action Task Force (FATF) self-assessment, in line with FATF recommendations and standards.
• Implement initiatives aimed at improving public financial and economic literacy to support overall financial stability.

Financial Market Infrastructure and Institutional Development

• Improve the regulatory and legal framework of the national payment system in line with digital transformation, support the development of new products and services, study the potential use of stablecoins as a means of payment, and strengthen oversight functions in accordance with international principles.
• Continue legal reforms in the banking sector, assess the effectiveness of recently implemented laws based on international best practices and common development trends, draft necessary legislation, and establish the legal framework for specialised asset management institutions to reduce non-performing loans.
• Develop medium-term policy measures to improve access to business financing, review lending conditions and requirements, and diversify the range of loan products tailored to borrower needs and sector-specific characteristics.

The Bank of Mongolia’s medium-term monetary policy will focus on maintaining macroeconomic and financial stability amid digital transformation, evolving international trade and economic relations, and structural shifts in the global financial system.