Kazakhstan Cuts Base Rate to 16.25%
The National Bank of Kazakhstan has lowered the base rate by 50 basis points to 16.25%, citing continued disinflation and a decline in annual inflation below 10%.
The decision was announced on Sept. 4 following 11 consecutive months of disinflation. Annual inflation eased to 9.8% in August, while food prices rose by 9.5%, non-food prices by 11.4% and services prices by 8.9%. Monthly inflation remained at 0.6%, with core inflation at 0.7%.
Inflation expectations have also moderated. Expectations for the next 12 months fell to 12.1% in July from 13.4% in June. At the same time, professional market participants continue to forecast inflation at around 10% by the end of 2026.
The National Bank kept its 2026 inflation forecast unchanged at 9-11%, while raising its 2027 forecast to 6.5-8.5% from 5.5-7.5%. The regulator attributed the revision to higher external inflation, updated assumptions for regulated prices and a stronger fiscal impulse. Inflation is expected to move closer to the 5% target in 2028.
The regulator maintained its forecast for Kazakhstan’s economic growth at 4.5-5.5% in 2026. GDP increased by 4.1% year-on-year in January-July, while non-mining GDP grew by an estimated 5.4%. Fixed capital investment rose by 7.7%, and retail trade increased by 4.1% in real terms.
GDP growth is projected at 4.5% in 2027. The National Bank also upgraded its 2028 growth forecast to 4-5% from 3.5-4.5%.
The next scheduled decision on Kazakhstan’s base rate is expected on Oct. 23.
