The Atyrau bridge in Kazakhstan

Kazakhstan Monetary Policy January 2024

Kazakhstan: NBK continues monetary policy easing in January

On 19 January, the National Bank of Kazakhstan (NBK) reduced its policy rate by 50 basis points to 15.25%. As a result, rates have now been cut by a cumulative 150 basis points since August 2023. Meanwhile, the Bank maintained the interest rate corridor at plus or minus 1.0 percentage point.

At the tail-end of 2023, inflation fell to a 22-month low of 9.7% on the back of the Bank’s restrictive monetary policy stance, a high base effect and cooling external price pressures. Moreover, the Bank commented that inflation expectations had decreased. Against this backdrop, the Bank opted to continue cutting its policy rate; however, it highlighted several upside risks to the outlook, including potentially stronger fiscal stimulus and possible increases in food prices due to a poor harvest this year.

In its communiqué, the NBK stated that “achieving the 5% inflation target requires maintaining moderately tight monetary conditions” but simultaneously that “the gradual reduction of the base rate will continue”. Our panelists currently expect between 50–500 basis points of further rate cuts by end-2024.

The next decision of the NBK is set for 23 February.

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