Due to good stance in the non-commodity sector in 1Q2023, Kazakhstan's economy showed solid growth at 4.9% yoy (the highest growth rate over the past 11 years). The high growth rates of the Kazakh economy occurred despite the persistence of tight monetary conditions in the republic (the base rate remained at the level of 16.75%), as well as against the backdrop of geopolitical tensions in the world. Taking into account the sticky external and internal pro-inflationary risks, the NBK expressed the need to maintain the base rate at the current level during 1H2023. Correction in energy prices in the global market and a reduction in physical volumes of oil supplies led to a decrease in the trade surplus in 1Q2023 by 58.3% yoy due to a 14.4% yoy decline in export volumes and a 41.4% yoy increase in imports. Such dynamics in the trade account combined with a reduction in the deficit on other large current account items led to a negative balance of $1.6 billion. The republic’s consolidated international reserves in 1Q2023 increased by 4.2% since the beginning of the year and amounted to $94.6 billion. The growth of the country’s reserves occurred both due to an increase in NF assets (+4.8% qoq) and NBK reserves (+3.2% qoq). The exchange rate of the national currency in the period strengthened by 3.2% qoq to 448 tenge per US dollar.
The macroeconomic picture in the republic in 2023, according to our forecasts, will be as follows: GDP growth rate will be 4% yoy against the background of a slowdown in inflation to 12.0% yoy, and the exchange rate will be at the level of 475 tenge per 1 US dollar as of the end of the current year.