Experts: Inflation in Kazakhstan Rising Faster Than Expected

Inflation in Kazakhstan is outpacing government forecasts, and experts warn that keeping it in check will require a prolonged period of high interest rates and a revision of inflation targets, Orda.kz reports, citing the Association of Financiers of Kazakhstan (AFK).

In their latest review, AFK experts remind that the official inflation target for this year is 5%. Inflation should increase by no more than 0.41% each month to keep price growth within this framework. And without maintaining high rates, this is impossible.

The AFK suggests that the government and the National Bank must revise their inflation projections and take urgent action, as prices are rising much faster than anticipated.

The monthly increase in consumer prices has accelerated from 0.9% to 1.1%, while annual inflation has risen from 8.6% to 8.9%. As a result, interest rates may stay high for longer than initially expected, the AFK warns.

Meanwhile, the tenge exchange rate, which began to appreciate, is weakening again.

In recent trading sessions, the dollar reached 521.83 tenge. Analysts attribute this to rising inflation and the devaluation of the Russian ruble, which impacts Kazakhstan’s economy.

Original Author: Nikita Drobny