Food prices rose 1.7% in March with the pace of increase accelerating to 9.3%, the highest annual average since 2017, Chairman of the National Bank Yerbolat Dossayev said at a government session on Tuesday, April 14.
The growth dynamics was caused by a seasonal increase in prices for vegetables along with spontaneous demand caused by the state of emergency that was declared by Kazakhstan on March 16.
The most in-demand food includes sugar with the average retail price increase of 8.5%, fruits and vegetables — 5.1% and buckwheat — 2.5%.
According to Dossayev, prices for non-food consumer products rose by 5.5% compared to 2019 indicators.
With the last year’s low base effect wearing off, the growth rate of prices for paid services has accelerated to 3.5%. Tariffs for transport, communications, certain housing and public services have also increased, he said.
Yerbolat Dossayev noted that volatility in global financial markets coupled with quarantine measures could clearly cause a recession in the global economy.
Such a negative economic scenario along with the noticeable decline in oil prices creates fundamentally new economic conditions and challenges for our country. Taking into account anti-crisis measures initiated by President Tokayev, the National Bank has adapted its monetary policy, having slashed its benchmark interest rate to 9.5% with a corridor of +/-2%. Continued maintenance of a high base rate would limit economic activity. This, in combination with other anti-crisis measures, will support business activity and encourage further lending, he said.
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