The growth of Kazakhstan's GDP in 2017 is expected at 3.5%, in 2018 - 2.8%, Kazpravda.kz reports with reference to the NBK press service.
The National Bank conducts forecast rounds four times a year, during which the forecast of the main macroeconomic indicators, primarily inflation, is carried out for the medium-term for the next seven quarters. Basing on the obtained forecasts and estimates, the Bank takes decisions on monetary policy, including the level of the base rate. On November 23 this year the regular October-November 2017 forecast round was completed. The forecast period is from the fourth quarter of 2017 to the second quarter of 2019.
According to the latest assessment of the National Bank, Kazakhstan's economic growth rate will accelerate to 3.5% (in the previous forecast round - to 3.1%) in 2017 and will weaken to 2.8% in 2018 (to 3%). The Bank explained revision of the growth rate by the acceleration in the III quarter of this year of recovery processes in the real sector of the economy. And the economy growth largely owes to increased volume of mineral resources extraction. Positive dynamics is maintained in other sectors of the economy.
The short-term economic indicator, based on changes in the indices of output in the basic industries, in January-October 2017 increased by 5.4% on-year. The growth of investments in fixed assets continues to support the growth rate of the economy. It is expected that the current moderate growth rate of investment will remain on the background of the production activity expansion.
At the same time the Bank points out that the recovery of households’ consumption is slow. On the one hand, it is supported by the growth of retail lending, but it is limited by the reduction in real monetary incomes of the population. In view of this fact, assessment was revised of the output gap in the forecast period from slightly positive to slightly negative, which indicates that the disinflationary pressure in the economy remains throughout the forecast period. It is estimated that the closure of the gap is to be in the second quarter of 2019. Thus, due to the current structure of economic growth in the forecast period, changes related to the diversification of the economy are not expected, which tells on the significant exposure to external shocks.
In turn, the prerequisites for economic growth in the forecast period have not changed. The National Bank expects recovery of domestic consumption, growth of investment in fixed assets. At the same time, the growth of imports of consumer and investment goods as a result of expanding domestic demand will act as a deterrent to the GDP growth.
Basing on the latest forecast round, oil price at $ 50 per barrel is considered as the main scenario for Kazakhstan economy throughout the period under review.
According to the forecasts, annual inflation in Kazakhstan during the fourth quarter of 2017 will be closer to the upper range of the target corridor of 6-8%, and in 2018 it will start a smooth entry into the target corridor of 5-7%. In particular, stable prices for oil and grain, lower inflation expectations and weak disinflationary pressure from domestic demand will lead to inflation in the target corridor of 5-7% in 2018 and 4-6% in early 2019.
At the scenario of $ 40 per barrel, annual inflation will be higher than the upper boundary of the target corridor in 2017-2018, which will require tightening of monetary conditions.
Reported by the Kazakhstanskaya Pravda.
