Kazakhstan cuts interest rates under pressure from president

Cut to 9% comes just days after president ordered change

The National Bank of Kazakhstan (NBK) cut its policy rate by 25 basis points to 9% on April 15, following calls from the country’s president to make credit more affordable.

The cut comes just days after Kassym-Jomart Tokayev, Kazakhstan’s new president, ordered the NBK to find a way to lower banks’ lending rates and ensure growth in lending, according to Reuters. Tokayev is facing a snap election on June 9.

The change is the first since October 2018, and comes less than two months after the appointment of former deputy prime minister Yerbolat Dossayev as governor of the NBK. Previous president Nursultan Nazarbayev had harshly criticised the NBK for what he saw as a failure to enable his goal of 5% GDP growth.

Despite the pressure on the exchange rate of the tenge currency, the NBK said rates should be cut due to slowing inflation and higher oil prices. Inflation in Kazakhstan was 4.8% in March, below the midpoint of the target range of 4–6%.

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