The International Monetary Fund on Monday urged Kazakhstan to keep its monetary policy stance tight until inflation is "firmly on track".
The IMF statement, following a staff team visit to Kazakhstan, comes days after the country's central bank cut its key interest rate to 17 percent from 18 percent, citing a slowdown in inflation.
"With inflation still well above target, the monetary stance should remain tight until inflation is firmly on track toward the 5 percent target," said Amina Lahreche, head of the IMF mission to the Central Asian country.
Inflation in Kazakhstan is projected to remain around 10 percent this year, with expectations still weakly anchored, IMF's Lahreche added.
Kazakhstan's consumer inflation rate in May stood at 10.4 percent year-on-year, compared with 10.6 percent in April. The country's central bank this month revised its inflation forecast for 2026 to 9-11 percent from 9.5-11.5 percent.
Like other Central Asian countries, whose economies are closely intertwined with Russia's, Kazakhstan has suffered a major surge in inflation since the outbreak of war in Ukraine.
"External price pressures, acceleration of quasi-fiscal activities and capital spending in the second half of the year, and continued utility price adjustments pose upward risks," the IMF added.
The fund projected Kazakhstan's growth at about 4.6 percent in 2026, as elevated oil prices offset lower oil production, the slowdown of household credit growth, and ongoing fiscal consolidation.
The National Bank of Kazakhstan should stand ready to tighten monetary policy if inflation does not continue firmly on a downward trajectory, the IMF said.
Reuters
