National Bank Governor Timur Suleimenov explained the reasons behind the decision to lower the base rate to 16.25%. This was reported by Qazaqyia.kz citing Sputnik Kazakhstan.

Inflation decreased

According to him, several factors influenced the National Bank's decision. As of August, annual inflation slowed to 9.8%, decelerating for 11 consecutive months. This was driven by monetary policy, tenge strengthening, stabilization of consumer demand, and anti-inflationary measures.

Food inflation slowed to 9.5%, non-food price growth to 11.4%, and services inflation to 8.9%. Inflation expectations of the population also declined. In July, one-year-ahead expectations fell from 13.4% to 12.1%.

However, the head of the National Bank noted that inflationary risks remain elevated, necessitating a moderately tight monetary policy.

Economic growth maintained

In January–July 2026, Kazakhstan's economy grew by 4.1%. Growth in the non-oil sector was higher, with GDP excluding mining estimated at 5.4%. Growth was particularly notable in construction, manufacturing, transport, and warehousing. Domestic demand remains stable: retail trade volume increased by 4.1% in January–July.

Investment activity is also high. Investments in fixed capital rose by 7.7%, and excluding state budget investments, by 19%.

External risks persist

The National Bank head acknowledged ongoing external inflationary pressures. Geopolitical tensions are affecting global food and energy prices. The oil market situation remains uncertain. Under the baseline scenario, oil prices are projected at $89 per barrel in 2026, $75 in 2027, and $65 in 2028.

Inflation forecast unchanged

The inflation forecast for 2026 remains at 9–11%. For 2027, inflation is projected at 6.5–8.5%. This is influenced by external inflationary pressures, changes in regulated prices, and increased fiscal stimulus.

"Our goal is not just to bring inflation below 10%. The main goal is to sustainably reduce inflation to around 5% by 2028. Until we reach that target, it is crucial to maintain a moderately tight monetary policy, carefully balance risks, and respond promptly when conditions change," Suleimenov said.

Recall that today the National Bank announced a cut in the base rate from 16.75% to 16.25%. The inflation forecast for 2026 remains unchanged at 9–11%. The GDP growth forecast for 2026 under the baseline scenario also remains at 4.5–5.5%.