- Decision
- Maintain
- Rate change
- 0 bps
- base rate
- 18%
The Monetary Policy Committee of the National Bank of Kazakhstan (NBK) left the base rate unchanged at 18.0 percent after its 6 March 2026 forecast round, judging that moderately tight monetary conditions are still needed to anchor elevated inflation expectations and guide headline inflation, which slowed to 11.7 percent in February from 12.2 percent in January, toward the single-digit range of 9.5–11.5 percent projected for 2026. Following a cumulative 150 bp increase to 18 percent in October 2025, the rate has been kept steady at subsequent meetings. Tightness is being reinforced through phased increases in minimum reserve requirements, mirroring operations and macro-prudential curbs that have cooled unsecured consumer lending growth to –7.2 percent y/y this January. The economy remains resilient, with non-commodity sectors expanding and GDP forecast to grow by 3.5–4.5 percent in 2026, though retail trade growth has eased to 2.1 percent as households adjust to higher taxes. Disinflation is supported by a moratorium on utilities and fuel tariffs and a more favourable tenge exchange rate, but risks persist from elevated expectations, potential second-round effects of tax and price reforms, and geopolitical volatility that could affect oil prices—NBK’s baseline now assumes Brent at USD 66.3/bbl this year before easing to USD 60. The Committee reiterated that there is “still no room” to cut rates; it may consider easing in the second half of 2026 only if inflation decelerates sustainably, while tightening could be extended should pro-inflationary risks intensify.
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.