On Monday 9th September, Kazakhstan’s Central Bank announced a 25 basis point increase in its key interest rate from 9% to 9.25% in a bid to suppress inflationary pressures from a rise in domestic demand and spending.
The last time the interest rate was at this level was in March 2019, before the Central Bank cut it to 9% in April 2019 up until Monday’s announcement.
According to Reuters, Yerbolat Dosayev, the Central Bank’s chairman, said in a briefing: “We hope today’s decision will allow us to ease the pressure on the market … ensuring that inflation is within the target range”. A Reuters poll of nine analysts last week saw four analysts anticipate a rate hike, four predicting no change and one expecting a rate cut.
Any further changes will depend on the movements in inflationary factors such as consumer prices, domestic demand, import growth and global economic conditions. Annual inflation increased slightly by 0.1% between July and August (5.4% to 5.5%), with the Central Bank aiming to keep it within the 6% for the year.
The next rate review date is scheduled for 28th October 2019.