Annual inflation slows down to 8.5% in Kazakhstan

Annual inflation slowed down to 8.5% in May, a 0.2 percentage point (p.p.) decline compared to April, according to the Bureau of National Statistics. In April, inflation slowed down by 0.4 p.p. year-on-year.

Over the past month, prices increased by 0.4%, whereas in April prices grew by 0.2 p.p. The National Bank raised the base rate by 0.25 p.p. to 14.5% on May 31.

«In order to reach 5% inflation in the middle-term perspective we need to proceed with our relatively tough monetary policy as long as it takes,» the National Bank said.

Over the past year, the cost of services in Kazakhstan grew by 13.9% (13.5% in April), non-food products by 7.6% (7.6% in April) and food products by 5.5% (6.3% in April). In ten regions of Kazakhstan, average inflation is higher than in the country as a whole. The highest rates of inflation were reported in the Karaganda (10.5%) and Mangystau (10.2%) regions and Astana (10.4%).

In late May 2024, the National Bank published the results of its macroeconomic survey. According to experts the regulator talked with, inflation was bound to slow down from 8.7% in April by 0.2 p.p. This means that the actual inflation and experts’ inflationary expectations for Kazakhstan match each other this year.

At the same time, the interviewed experts anticipate inflation to decrease to 6.8% next year. The respondents expect inflation to slow down to 6% in 2026, although the target rate for that year is 5%.

In late April, the Applied Economics Research Center (AERC) worsened its forecast for average annual inflation this year to 9.1% (8.8% in January). According to analysts, annual inflation has been going downward since the beginning of 2024.