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Annual inflation in Mongolia reached 12.9% in September 2026, rising from the level recorded a year earlier. According to the Bank of Mongolia, higher fuel prices were the main contributor to inflation during the month. Although pressure from food prices is gradually easing, food remains a major component of household spending and continues to affect living costs.

Fuel price increases push inflation higher

According to the Bank of Mongolia, annual inflation stood at 12.9% nationwide and 11.9% in Ulaanbaatar in September 2026. Core inflation reached 7.2%.

During the month, the price of diesel rose 11.8% from the previous month, while AI-95 petrol increased by 13.8%, contributing to the rise in inflation. Fuel price changes are not limited to the costs faced by vehicle owners. They can also affect the prices of goods and services through transport, distribution and production costs.

Food prices: distinguishing annual changes from monthly declines

Food prices require close attention as one of the key components of inflation. Food is an essential part of daily household consumption, and when prices rise, families must spend more to buy the same amount of products.

However, it is important to distinguish between annual and monthly indicators when interpreting price movements. According to the Bank of Mongolia, meat and meat product prices fell 1.3% from the previous month in September, while prices of food products excluding meat declined by 0.6%. Imported food inflation also slowed for the second consecutive month, reaching 6.2%.

These figures show that the pace of food price increases eased during the month; they do not mean that food products became cheaper than they were a year earlier. Household purchasing power therefore cannot be assessed solely on the basis of price movements in a single month.

Import dependence increases food price risks

Imports play an important role in Mongolia’s food market alongside domestic production. Data from the General Customs Administration show that imports of wheat, vegetables, sugar, fruit, nuts and some types of meat and meat products increased in the first nine months of 2026 compared with the same period a year earlier.

Wheat imports, for example, reached 138,000 tonnes, an elevenfold increase from a year earlier, while vegetable imports rose 9.1% to 114,900 tonnes. Fruit and nut imports increased 35.5% to 64,000 tonnes.

Higher import volumes alone do not prove that prices have risen. Rather, they show the need to consider the structure of supply alongside international prices, exchange rates, transport costs and domestic production conditions.

Impact on real household incomes

An inflation rate of 12.9% does not mean that the prices of all goods and services increased by exactly the same amount. It represents the annual change in the overall consumer price basket.

However, if growth in wages, pensions and other income fails to keep pace with rising prices, households face a decline in real purchasing power. Families that spend most of their income on essentials such as food, housing, heating and transport may feel the impact of price increases particularly acutely.

Assessing inflation’s real impact therefore requires more than looking at the national average. Household incomes, spending patterns and changes in essential costs must also be considered.

What to watch going forward

The Bank of Mongolia’s Monetary Policy Committee decided on September 17, 2026, to keep the policy rate unchanged at 12.5%. At the time, it highlighted inflation risks arising from fuel prices, external conditions, government spending and wage growth.

The following factors will be important for the price outlook:

  • Fuel prices: Whether they will have knock-on effects on transport, distribution and production costs.
  • Food supply: Whether supplies of meat, vegetables and other essential products remain stable.
  • Import costs: Changes in international prices, exchange rates and transport costs.
  • Monetary and fiscal policy: Their impact on domestic demand and price growth.

The future direction of inflation cannot be determined from data for a single month. The consumer price index, movements in the food category, fuel prices and changes in real household incomes should therefore be monitored together in the coming months.

Conclusion: Mongolia’s inflation rate reaching 12.9% in September highlights the need to pay close attention to household expenses and purchasing power. The monthly data show that fuel prices were the main driver of inflation, while the pace of food price increases eased. To determine whether price pressures are genuinely declining, it will be important to assess data from the coming months alongside income growth.