- Decision
- Maintain
- Rate change
- 0 bps
- base rate
- 15.25%
The Monetary Policy Committee of the National Bank of Kazakhstan left the base rate steady at 15.25 %, keeping the corridor at ±1 percentage point, arguing that firm action is still needed as price pressures remain broad-based, fuelled by faster service and non-food inflation, the “Tariff-for-Investments” programme and a weaker tenge. December headline inflation inched up to 8.6 %, within the 8–9 % 2024 forecast range but well above the 5 % target, while the stable component of inflation and households’ expectations both rose. Economic activity is buoyant—the short-term economic indicator accelerated to 6.2 % y/y by end-2024 on strong gains in agriculture, construction, trade, transport and manufacturing—pointing to demand that exceeds supply, supported by fiscal stimulus, rising incomes and rapid consumer lending. The tenge’s depreciation and ongoing price-regulation reforms amplify internal risks; externally, high global food prices, quicker inflation in Russia and the likelihood of prolonged tight policies in advanced economies keep imported inflation elevated. Acknowledging that aggregate monetary conditions have “slightly softened”, the central bank said it will reassess the case for further tightening at its next rate-setting meeting in March to steer inflation back towards the 5 % objective.
Rate evolution
Over the period, the National Bank of Kazakhstan raised the base rate by 150 basis points from 16.5% to 18.0%, holding through mid-2025 before tightening in October 2025 and then leaving policy unchanged into April 2026. The early holds reflected persistent inflation and a risk balance that turned increasingly pro-inflationary, as tariff reforms, fuel liberalisation, strong consumer demand, retail lending and fiscal stimulus kept demand above supply, while volatile expectations and external pressures from global food prices, Russia, trade frictions and geopolitical tensions added to price growth. After inflation exceeded forecast and monetary conditions were judged to have loosened, the Bank raised the rate.
More recently, inflation slowed under moderately tight conditions, anti-inflation measures, the stronger tenge and a moratorium on utility and fuel price increases, and by June 2026 the Bank judged that moderate domestic demand and favourable external conditions partly offset accumulated pressures. With annual inflation easing to 10.4% in May from a 12.9% peak in September 2025 and the 2026 forecast revised down to 9.0% to 11.0%, the National Bank of Kazakhstan cut the base rate by 100 basis points to 17.0% on 5 June and by a further 25 basis points to 16.75% on 24 July as inflation edged down to 10.3% in June, while warning that underlying price pressures required confirmation. On 4 September, it lowered the rate by 50 basis points to 16.25% as annual inflation slowed for an eleventh month to 9.8% in August and one-year inflation expectations fell to 12.1% in July, but said scope for further cuts was limited after raising its 2027 inflation forecast to 6.5% to 8.5% and assessing that risks had shifted in a pro-inflationary direction amid stronger fiscal stimulus, unstable expectations, fuel and utility prices, and global food and energy costs.