FX.co ★ Kazakhstan Maintains Base Rate at 18% in January

The National Bank of Kazakhstan opted to maintain its benchmark interest rate at 18% as of January 23, 2026, a decision that aligns with market expectations. This move was made amidst the context of sustained high inflation and robust domestic demand. By the end of 2025, annual inflation reached 12.3%, consistent with the central bank's forecasts, largely influenced by rising food prices. December saw monthly inflation rise to 0.9%, while core inflation stayed high. Inflation expectations have further increased, with households anticipating a 14.7% inflation rate over the next year and market participants projecting a 10.8% rate for 2026. Despite the disinflationary support from a stronger tenge and tighter financial conditions, potential challenges persist, including the impacts of fuel price liberalization, tariff adjustments, tax modifications, and a projected quasi-fiscal stimulus. In light of these factors, the central bank indicated that it is likely to retain the policy rate at its current level through the first half of 2026. The subsequent rate review is scheduled for March 6, 2026.