Monday, October 28, 2019

Kazakhstan maintains rate as inflation seen in target

     Kazakhstan's central bank left its base rate steady at 9.25 percent and reiterated its forecast for inflation to end this year around 5.7 to 5.8 percent and then settle within its target corridor of 4.0 to 6.0 percent until the end of 2020.
     The National Bank of the Republic of Kazakhstan (NBK) also reiterated its guidance from last month that future policy decisions would be based on how inflation evolves in comparison with its target.
     NBK raised its rate by 25 basis points in September, unwinding a rate cut in April and returning the rate to its level seen from October 2018 to March 2019.
     Kazakhstan's inflation rate eased to 5.3 percent in September from 5.5 percent in August while core inflation, which excludes the prices of fruits and vegetables, regulated services and energy, eased to 7.7 percent from 7.9 percent.
     The growth in food prices accelerated in September to 9.1 percent, mainly due to higher domestic prices pulled up by higher world market prices, and meat and meat product prices were up 13.5 percent year-on-year.
     But inflationary expectations did not change significantly, the NBK said, and over the next 12 months inflation is seen at 5.4 percent.
     Business activity is also continuing to growth, with short-term economic indicators up 4.7 percent in the first 9 months of the year and investments up 9.7 percent.
     The tenge has firmed in recent days and was trading at 388.6 to the U.S. dollar today but is still down 3.3 percent since the start of this year.


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