The National Bank of Kazakhstan has raised its base rate by one percentage point to 15.25%. This move follows the sharp drop in the tenge and rising inflation, the regulator reported.
Inflation in Kazakhstan reached 8.5% in October, driven by higher tariffs and faster price increases for services and non-food goods. The National Bank also noted the failure to meet budget revenue targets and the volatility of inflation expectations.
The tenge’s weakening played a key role in the decision to tighten monetary policy. The official exchange rate against the US dollar fell nearly 3.7% in one week. This drop mainly resulted from the sharp decline in the Russian rouble.
The National Bank highlighted fluctuations in the rouble and high inflation in Russia as major contributors to external inflationary pressures, alongside rising global food prices.
The regulator expects inflation in Kazakhstan to reach 8-9% by the end of 2024. Prices are forecast to rise by 6.5-8.5% next year. The National Bank does not expect inflation to hit the target of 5% until 2027.
