EDB forecasts decrease on inflation in Kazakhstan
Eurasian Development Bank analysts predict that inflation in Kazakhstan may slow down to 7 percent by the end of the year. They note that Kazakhstan’s economy reached a pre-pandemic level in the second quarter of the year. This rapid growth is reflected in inflation, Alexey Kuznetsov, Head of the Country Analysis Center at the EDB, said. He expects that inflation in the country to slow down in the second half of the year. The average rate for this period is projected at 423 tenge per one USD, and the growth of the country’s economy at the end of the year is estimated at 4 percent. Kuznetsov notes that there are also risks of deviation from these forecasts. They are primarily related to the worsening epidemiological situation. An external factor could be the overheating of the U.S. economy and, as a consequence, the tightening of U.S. monetary policy.
“If that happens, we will see pressure on developing economies through capital outflows, including from Kazakhstan, a weakening of the national currency and rising domestic interest rates. In this case, the national bank’s decision to raise the rate, among other things, would contribute to the balance of the domestic foreign exchange market,” the analyst said.
Translation by Assem Zhanmukhanova
Editing by Galiya Khassenkhanova