Kazakhstan: Inflation continues to surge at the beginning of 2016
February 4, 2016
Consumer prices increased 1.3% in January over the previous month, which followed the 1.2% rise observed in December. The monthly increase resulted from higher prices for food, alcoholic beverages, health and transport.
Inflation climbed from 13.6% in December to 14.4% in January, and thus advance to levels last registered in September 2008. As a result, inflation remains well above the National Bank of Kazakhstan inflation target established in September 2015. Under the new inflation targeting regime, the Central bank established an inflation target corridor of between 6.0% and 8.0% for the medium term.
Inflation is likely to continue rising in the coming months, mainly due higher prices for imported goods as a result of the ongoing weakening of the national currency. However, as domestic demand is expected to weaken going forward, this should dampen inflationary pressures and bring inflation down the Central bank’s target in the medium term.
Author: Ricardo Aceves, Senior Economist