National Bank may raise Key Rate in 2010
Kazakhstan's central bank said on Wednesday it may raise its key refinancing rate by one percentage point to 8.0 percent this year if oil prices average $70 per barrel.
"Inflationary pressure is unlikely to subside in 2010 due to certain risks," the bank said in a statement, adding those risks stemmed from planned increases in public sector wages as well as higher import duties.
Oil-rich Kazakhstan sees 2010 inflation at 6.0-8.0 percent after consumer prices rose by 6.2 percent last year.
Current account deficit will be 4 percent of gross domestic product if the average oil price is $50 per barrel, and 1 percent of GDP at $70 per barrel, the central bank said, identifying those two scenarios as most likely.
The Central Asian state reduced interest rates throughout last year as its economy briefly slipped into recession. But the government the economy to grow by 2.0 percent this year, up from 1.2 percent in 2009, according to Reuters