Kazakhstan Interest Rate

The National Bank of Kazakhstan kept its benchmark interest rate unchanged at 16.5% on August 29, 2025, maintaining a tight stance amid persistent inflation risks. Annual inflation held at 11.8% in July, with food prices now the main driver as service inflation slowed, while monthly inflation eased to 0.7% but stayed above average. Inflation expectations climbed to 14.2%, reflecting risks from tariff reforms, fiscal stimulus, strong demand, and rapid lending growth. In this context, the Bank revised its 2025 inflation forecast to 11–12.5% and raised its GDP growth outlook to 5.5–6.5%, supported by robust investment and consumption. To reinforce disinflation, new reserve requirements will take effect in September alongside tighter credit measures. Policymakers stressed that the restrictive stance remains key to steering inflation toward the 5% target, while keeping the option open for further hikes if risks intensify. The next decision is due October 10.