15.25% Per Annum: National Bank Raised Base Rate

The National Bank of Kazakhstan raised the base rate to 15.25% per annum to combat inflation, which reached 8.5% in annual terms in October, Orda.kz reports. 

The reasons for the price increase are the rising cost of regulated services, the weakening of the tenge, and high domestic demand.

Global inflation, rising food prices, and currency fluctuations are also factors.

Outlooks for the coming years show that inflation will remain above target levels due to fiscal stimulus, housing and utilities reforms, and external factors.

In 2024, inflation is expected to be 8-9%; in 2025, around 6.5-8.5%; and in 2026, up to 5.5-7.5%.

Kazakhstan's economy will continue to grow, but falling oil prices and weak external demand will limit the pace.

The GDP growth forecast for 2024 is 4-4.5%.

The National Bank also plans to tighten monetary policy to stabilize inflation and reach the target of 5% by 2027.

More details will be released in the Monetary Policy Report on December 9. The next rate decision will be announced on January 17, 2025, The National Bank reported.

Original Author: Artem Volkov