NUR-SULTAN, July 20 (Xinhua) -- The Kazakhstan National Bank or central bank Monday cut the key interest rate from 9.5 percent to 9 percent and narrowed the corridor from plus or minus 2 percentage point to 1.5 around the benchmark.
According to a central bank statement, the Kazakh economy has seen a decrease of pro-inflationary risks and a stronger recession than expected in the first half of the year. Quarantine measures taken in the second lockdown will have an additional disinflationary effect. All have contributed to the rate cut.
Kazakh President Kassym-Jomart Tokayev told a cabinet meeting on July 10 that the country's economy has grappled with complications, with GDP shrinking by 1.8 percent year-on-year in January to June and output in the services sector falling by 5.6 percent.
Kazakhstan's central bank hiked the interest rate from 9.25 percent to 12 percent on March 10 due to the collapse of oil prices. The rate dropped to 9.5 percent on April 6 and has since been kept at the same level.