Financial market is stable – Chair of the Kazakh National Bank

“This September saw the annual inflation slowing down to 5.3% from 5.5% in the previous month, mostly contributed by the growing food prices by 9.1% since 2017, including 13% and 12.7% increases in prices for meat and bakery products and groats prices, respectively, with their input in the inflation growth equalling 1 percentage point. These products have gone up in the backdrop of rising global prices and exports”, he said.

Prices for non-food products and paid services help to dampen the inflation rate, with the annual rise in non-food products prices of 5.4%, which is the lowest annual growth since October 2015.

Gasoline prices have fallen by 4.8% within the year, and solid fuel – by 3.5%. Paid services have gone up 0.7% due to an 8.2% decline in regulated services rates.

“This year’s inflation will have been within the bounds, and will have been 5.7-5.8%”, Dossayev said.

On 9 September 2019, the National Bank’s base rate was raised to 9.25% with the +/-1 percentage point range to keep inflation within the bounds.

The National Bank proceeds with the extension of timelines and the decrease in the number of notes. Between May-September this year the number of notes in circulation fell by 33.3% from 4.3 trillion tenge to 2 trillion 900 billion tenge, with the 40% decrease since the peak in February.

“As of 1 October 2019, the National Bank’s international reserves $28.8B, down by 6.8% since the year’s beginning $2.1B due to the restructuring of foreign exchange swap and a movement of funds in foreign currency abroad”, he said. 

The number of deposits has fallen by 5.5%, to 17.5 trillion tenge by this August, with deposits in national currency growing by 3%, and foreign currency deposits declining by 14.5%.

The interest rate on short-term credits for business declined to 11.6% and on long-term credits rose to 13.4%.

Adlet Seilkhanov