The National Bank of Kazakhstan cut the base rate by 50 basis points to 16.25%, with a plus or minus 1 percentage point corridor, as easing inflation and household expectations allowed some loosening, although stronger pro-inflationary risks limit scope for further cuts. After raising the rate to 18% in October 2025 and holding it through April 2026, the central bank cut it in June and July. Annual inflation slowed for an 11th consecutive month to 9.8% in August and is forecast at 9-11% in 2026, while the 2027 forecast was raised to 6.5-8.5% due to higher external inflation, revised regulated-price assumptions and greater fiscal stimulus. Gross domestic product growth is projected at 4.5-5.5% in 2026, supported by investment and sustained consumer demand, while the final increase in minimum reserve requirements in September will provide additional restraint. A firm tenge exchange rate has supported disinflation. Externally, the continuing Middle East conflict is keeping energy prices elevated and reinforcing inflationary pressure, while global food prices increased slightly and major central banks maintained hawkish rhetoric. Future decisions will depend on inflation, domestic demand, expectations, regulated prices and fiscal and quasi-fiscal stimulus, with policy aimed at bringing inflation close to the 5% medium-term target in 2028.
2026-09-04National Bank of Kazakhstan
National Bank of Kazakhstan Cuts Base Rate by 50 Basis Points to 16.25%
The National Bank of Kazakhstan cut the base rate by 50 basis points to 16.25%, with a plus or minus 1 percentage point corridor, as annual inflation eased to 9.8% in August. Stronger pro-inflationary risks limit further cuts, with policy aimed at bringing inflation near the 5% medium-term target in 2028.