JAN. 29 (The Conway Bulletin) — Armenia’s Central Bank cut its key interest rate by a quarter of a percentage point to 5.75%, its first downgrade since February 2017. It said that low inflation was the root cause of this downgrade. Most of the region has been suffering from low prices since countries recovered from an economic downturn in 2014-17.
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>This story was first published in issue 398 of The Conway Bulletin on Jan. 31 2019
Copyright The Conway Bulletin 2019
JAN. 17 (The Conway Bulletin) — Fuel prices in Kyrgyzstan rose by over 10% in 2018, media reported by quoting the National Statistics Committee, far quicker than the average inflation rate of 4.5%. People in Kyrgyzstan are increasingly frustrated about jobs going to Chinese, and rising petrol prices will feed into this frustration. The National Statistics Agency also said that Kyrgyzstan’s GDP growth in 2018 had been 3.5%, roughly in-line with expectations.
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>>This story was first published in issue 397 of The Conway Bulletin on Jan. 20 2019
DEC. 25/16 The Conway Bulletin) — Armenia and Azerbaijan both left their interest rates unchanged because of continued low inflation. Weak inflation has been a factor across the region since it recovered from a 2014-17 economic downturn.
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>>This story was first published in issue 396 of The Conway Bulletin on Jan. 11 2019
ALMATY/Oct. 16 (The Conway Bulletin) – Kazakhstan’s Central Bank raised its key interest rate for the first time in 2-1/2 years because of the rising threat of inflation, highlighting growing concern in the region that price rises may wipe out tentative economic gains made since a 2014-17 downturn.
Announcing the rate rise to 9.25% from 9%, Kazakh Central Bank chief Daniyer Akishev said inflation was currently sitting at 6.1%, square in the middle of the government’s 5-7% target for the year, but that pressure was building.
“Today’s decision, in our opinion, will reduce the severity of the problem,” he said. “The new level of base rates will increase the demand for tenge assets and bring monetary and credit conditions to a level close to neutral.”
Kazakhstan is the biggest economy in Central Asia and had looked to have made a reasonable recovery from a sharp economic downturn between 2014 and 2017 that was triggered by a collapse in oil prices and a recession in Russia. Over the last few months, though, the Kazakh tenge has come under pressure, dropping to its lowest level since the start of 2016. Analysts said global insecurity and concern over Emerging Markets have hit the tenge.
The Kazakh Central Bank last increased its core interest rate in February 2016 when it raised it by 1 percentage point to 17%. From then it slashed interest rates to 9% to stimulate growth.
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>>This story was first published in issue 388 of The Conway Bulletin on Oct. 17 2018
JAN. 28 (The Conway Bulletin) – Real wages in Kazakhstan have fallen for a third consecutive year, Halykfinance said in a report. It said that inflation had continued to outstrip wage growth. Wages, the report said, had fallen by 2% in the first three quarters of 2017 and that this would trend would continue in 2018, although it would slow to a real wage drop of 0.5%.
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>>This story was first published in issue 360 of The Conway Bulletin
FEB. 1 (The Conway Bulletin) – Turkmenistan raised its prices for petrol by 50% overnight, a sharp reminder of the financial pressure that the country is under. Petrol had been heavily subsidised by the government and while the prices are still low, around 1.5 manat or nearly half a US dollar for a litre, the price increase will rankle. Last year the government also cut subsidies on utilities.
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>>This story was first published in issue 360 of The Conway Bulletin
JAN. 31 (The Conway Bulletin) – Georgia’s Central Bank kept its key interest rate unchanged at 7.25% because it said that inflation would shortly start to drop. There had been discussion before the rates meeting that the Central Bank would have to increase interest rates. Annual inflation in Georgia hit 6.7% in December, higher than the Bank’s 4% forecast.
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>>This story was first published in issue 360 of The Conway Bulletin
JAN. 30 (The Conway Bulletin) – The Kazakh Central Bank chief Daniyar Akishev defended his policy of keeping interest rates high by insisting that he was still pro-business. Speaking to reporters he said that the Central Bank’s main priority was to target inflation and then to consider cutting the cost of borrowing. Mr Akishev said that he wanted to see inflation at 5-7% this year and 4% by 2020.
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>>This story was first published in issue 360 of The Conway Bulletin
DEC. 29 (The Conway Bulletin) — Inflation in Azerbaijan should measure between 6% and 8% in 2018, the Central Bank said. In the past couple of years, inflation in Azerbaijan has been measured in the double digits as the economy fights a sharp economic downturn and a currency devaluation that wiped 50% off the value of the manat in 2015/16.
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— This story was first published on Jan. 5 2018 in issue 356 of The Conway Bulletin
DEC. 26 (The Conway Bulletin) — Armenia’s Central Bank said that it was going to keep its interest rates steady at 6% although year-on-year inflation rose to 2.2% in November, up from 1.2% in October. The decision will be cheered by business which had warned that a rise in interest rates would dampen growth. Interest rates in Armenia had been at 10.5% in 2015 and have been steadily cut to stimulate economic growth.
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— This story was first published on Jan. 5 2018 in issue 356 of The Conway Bulletin