National Bank of Kazakhstan raises inflation forecasts for 2025 and 2026

In its updated scenario, the National Bank of Kazakhstan expects inflation to decline to 5.5% by 2027.

In 2025, the regulator projects inflation in the range of 12–13%, and for 2026 the forecast range has been revised upward, reaching 9.5–12.5%.

The revision is linked to higher inflation expectations. The actual inflation indicators currently forming are above previous forecasts. Therefore, the updated outlook takes into account a slower rise in regulated prices under the revised ‘inflation + 5%’ scheme for 2026–2027, said Timur Suleimenov, chief of the Kazakh National Bank.

The revision of the 2026 inflation range was explained by the National Bank as being due to increased uncertainty in assessments related to the implementation of the tax reform, particularly its impact on aggregate demand.

Demand remains strong despite the decline in real household incomes. Retail trade continues to expand. This may reflect the early realization of expectations related to the VAT increase in 2026, meaning people are trying to make purchases before the tax reform. The main driver continues to be purchases of non-food goods and services. Around 80% of the goods and services in the consumer basket are becoming more expensive at rates above the 5% target - this is an additional metric that shows the breakdown by goods, said Suleimenov.

The National Bank’s chief added that despite a significant slowdown in inflation in October to 0.5%, risks remain high, and in annual terms, core inflation reached 12.2%.

"Further liberalization of the fuel market and increased pressure from domestic demand due to quasi-fiscal stimulus will continue to have pro-inflationary effects."

Earlier, Qazinform News Agency reported the Monetary Policy Committee of the National Bank of Kazakhstan has decided to raise the base rate to 18% with a corridor of +/-1 percentage point.