Kazakhstan Raises Interest Rates for First Time Since 2022 After Tenge Decline

In a statement accompanying the decision, the central bank said it will consider tightening monetary policy further at its coming meetings “in order to quickly return inflation to the trajectory of a sustainable slowdown and achieve the target at 5%.”

The KazMunayGas National Co. headquarters, center left, stand in Astana, Kazakhstan/ Photograph: Taylor Weidman/Bloomberg 

Kazakhstan raised interest rates for the first time since 2022, citing concerns that a weakening national currency could lead to higher inflation, The Caspian Post reports citing Bloomberg.

The National Bank of Kazakhstan raised the benchmark to 15.25% from 14.25% on Friday. All economists surveyed by Bloomberg expected no change.

In a statement accompanying the decision, the central bank said it will consider tightening monetary policy further at its coming meetings “in order to quickly return inflation to the trajectory of a sustainable slowdown and achieve the target at 5%.”

The Kazakh authorities have been grappling with the economic fallout of Russia’s war on Ukraine and sanctions on its neighbor and second-biggest trading partner. The tenge has dropped to its weakest level since March 2022, prompting the central bank to conduct interventions this week.