Kazakh National Bank may lower base rate to 15.75-16% - analystsKazakhstan's National Bank may cut the policy rate from the current 16.25% to 15.75-16% at its monetary policy committee meeting on October 23, according to most analysts surveyed by Interfax-Kazakhstan.At its previous meeting on September 3, the National Bank cut the base rate to 16.25%. The rate had been held at 18% from October 2025 until June 2026, when the National Bank reduced it to 17%, then to 16.75% in July.Analysts at the Eurasian Development Bank expect a cut to 16%, while Finam and the Association of Financiers of Kazakhstan expect 15.75-16% and Freedom Finance Global expects 15.75%. ACRA believes the rate will stay at 16.25%.Analysts cite slowing inflation as the main reason for what would be the fourth rate cut this year. In September, inflation fell to its lowest since February 2025, at 9.3% year-on-year, while monthly inflation has held steady at 0.6% for three months running.Consumption and consumer lending growth also continue to slow. Retail trade growth slowed to 4.5% in the first nine months of 2026 from 7.1%.A prolonged period of stability in the national currency is also having a disinflationary effect and giving the regulator room to cut. Since the start of the year, the tenge has strengthened nearly 11%, from 511.26 per $1 to 448.61 per $1.At the same time, growth in prices for non-food goods and some unregulated services remains elevated. Non-food goods rose 1.1% month-on-month in September and services 1.0%, limiting room for a sharper cut.Budget and quasi-budget stimulus, tariff reform and external price shocks from ongoing military conflicts also continue to pose pro-inflationary risks.MODERATE CUT SEEN AS SUFFICIENTEurasian Development Bank analysts expect a cut to 16% to keep monetary conditions tight enough and bring inflation gradually toward the target. They point to one-year-ahead inflation expectations, which have fallen to 11.8%, a four-year low, and note that a strong tenge reduces the risk of imported inflation."A 50-basis-point cut to 15.75% is expected. The main reason may be the sharp slowdown in annual inflation in September, from 9.8% to 9.3%. In addition, the tenge remains fairly strong, so a rate cut will have minimal effect on the exchange rate and therefore on inflation," said Freedom Finance Global analyst Daniyar Orazbayev.Olga Belenkaya, head of macroeconomic analysis at Finam, warned that inflation could accelerate from October because of a low base created by 2025 government measures to control regulated prices, namely a moratorium on raising utility tariffs and fuel prices. Medium-term pro-inflationary risks linked to higher taxes, tariffs, import costs and a stronger dollar also remain."We believe Kazakhstan's National Bank may cut the base rate by another 25 or 50 basis points at its next meeting, given the continued slowdown in inflation and falling inflation expectations. At the same time, its rhetoric may retain a cautious approach to further monetary easing," Belenkaya said.The Association of Financiers of Kazakhstan, citing a survey of market participants, forecasts a cut to 15.75-16.00%, with 71% of respondents expecting 16.00%.Experts estimate the real rate over a 12-month horizon remains positive at 4.8%, indicating that monetary conditions will stay fairly tight even with a further cut in the nominal rate. Tenge stability, in turn, reduces the risk of currency weakness feeding into prices. (ICE ALMATY)

Fonte notizia: INTERFAX