NUR-SULTAN / ex ASTANA (Satrapia) — The National Bank of Kazakhstan kept its policy rate at 9% during its September 2020 meeting, in a widely expected move, after cutting it by 50 bps in July to support the economy.

Policymakers said the current policy stance remains appropriate to keep the inflation rate under control and help it to subside in the medium term. The annual inflation rate is estimated to reach 8% in 2020 and slow to 6% in 2021.

The bank also has revised its 2020 GDP projections that now point to a steeper contraction of 2-2.3% from an earlier estimate of a 1.8% decline. The economy is projected to return to growth of around 3.5-3.8% in 2021, as the pandemic situation gradually improves, boosted by the recovery of external demand, the implementation of deferred investment projects, the revival of consumer demand and the fiscal stimulus policy.

Still, there were cited concerns over the uncertain external environment as well as about fresh Western sanctions against Russia.