Inflation falls but risks of rebound remain in Kazakhstan

National Bank of Kazakhstan
Photo credit: nationalbank.kz

Kazakhstan observes inflation remaining above the target level, deputy chairman of the country’s National Bank Akylzhan Baimagambetov said, Kazinform News Agency correspondent reports.

According to the National Bank, the global economy demonstrated moderate increase against the weak growth in trade and investment amid geopolitical struggles and central banks’ tight monetary policies in response to elevated inflation in 2023.

Many countries saw inflation above target despite slowing down, requiring central banks to maintain higher interest rates. The International Monetary Fund forecasts return to the target inflation not earlier than 2025, said Baimagambetov during a meeting of the Committee on Finance and Budget of the Senate of the Kazakh Parliament.

He went on to note that despite the turmoil in external economy, Kazakhstan managed to reduce inflation by more than twofold in 2023 while achieving the highest economic growth of 5.1% in the past 10 years.

The National Bank of Kazakhstan cut the interest rate by 100 basis points from 16.75% to 15.75% in 2023 and to 14.75% this year thanks to stabilization in inflation.

Given the stabilization in external prices, the National Bank’s monetary policy and anti-inflation measures carried out by the government, the inflation fell to 9.8% from a high of 21.3% in February last year, said Baimagambetov.

The deputy chairman said that the inflation is still above the target level despite the decline as well as that inflationary risks remain.

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