predicted inflation rate in Kazakhstan by International Monetary Fund
Casting a Light on Kazakhstan's Economic Growth 🔦
The International Monetary Fund (IMF) drops by Kazakhstan from May 15 to 23, 2025, delivering insightful updates on the country's economic outlook.
Kazakhstan's economic engine is purring nicely, thanks to sectors like services, transportation, construction, industry (with a focus on mineral extraction and processing), and digital technologies, AI, agriculture, and logistics, gracing it with continuous growth. But, as with any powerhouse, there are potential risks lurking in the shadows.
The IMF experts have their radar locked on possible snags such as delays in crucial infrastructure projects, soaring inflation (prices rising quickly), or tightened international trade, causing a global economic slowdown. A dwindling oil market and sluggish economies of Kazakhstan's trade partners could also dampen the economic spirit.
But fear not, for our nation is bracing itself. The IMF is all praises for Kazakhstan's plans to tighten its macroprudential policy—a move that shall help maintain financial stability amidst a spiraling surge in consumer lending.
Having a close look at inflation, the IMF reports an acceleration in April 2025 and projects it to loiter around 10.5% this year. The IMF stresses that tension needs to be applied to monetary policy to rein in inflation, aligning with the National Bank's target.
Mark your calendars! The next IMF mission to assess Kazakhstan's financial health (under Article IV) is scheduled to drop by in September 2025.
Now, where's the tea and a chat about those juicy recommendations? Here's the downlow:
The IMF's Recommendations
- Fiscal Consolidation:
- The IMF thinks Kazakhstan needs to reboot its tax system in 2026, pair it with a smart budget plan, and tighten fiscal rules to promote fiscal consolidation. Keep an eye out: The non-oil fiscal deficit is projected to widen[1].
- The current fiscal stance remains open-handed, which could fan the flames of inflationary pressures if not managed properly[1].
- Monetary Policy:
- Tough love is what monetary policy needs, alleges the IMF! Keep it tight until inflation flirts with its target. Why? To help combat high inflation, which is projected to stay around 10.5% this year[1][4].
- Inflation Control:
- The IMF insists that corrective measures are necessary to cap deficits, tame inflation, and aid medium-term efforts to heap wealth upon the National Fund for the Republic of Kazakhstan[1].
- Economic Diversification:
- The IMF gushes about Kazakhstan's economic growth, nurtured by high activity in services, transport, construction, manufacturing, and mining sectors. It encourages continued economic diversification and technological progress, spicing things up in the realms of digital technologies, AI, agribusiness, and logistics[4].
- Risk Management:
- The IMF points fingers at several potential pitfalls, such as growth slowdowns caused by delays in major infrastructure projects or a tightening of international trade. It underlines the importance of managing these risks effectively to sustain economic growth[4].
Long story short, the IMF recommends fiscal consolidation, tight monetary policy, inflation control, and economic diversification to ensure sustained growth, no matter what curveballs the global economy throws at us.
The International Monetary Fund (IMF) suggests implementing fiscal consolidation in Kazakhstan, which involves revising the tax system in 2026, creating a budget plan, and enforcing stricter fiscal rules to promote stability, considering the anticipated widening of the non-oil fiscal deficit.
In addition, the IMF stresses the necessity of exercising control over inflation by enacting corrective measures to cap deficits, tame inflation, and contribute to the long-term buildup of the National Fund for the Republic of Kazakhstan. This is in response to the IMF's projection of inflation staying around 10.5% this year.
