AKIPRESS.COM - Kazakhstan’s experience with inflation targeting (IT) and a flexible exchange rate (ER) has been positive, the IMF said in its concluding statement of the 2019 mission.
Implementation of monetary policy is constrained by structural limitations which require measures on the part of the National Bank and the government. Key areas include:
· Enhancing the NBK’s independence, including through legal changes and divesting non-core activities and assets to signal a strong commitment to price stability.
· Further strengthening coordination between the government and the NBK to ensure a well-balanced policy mix in support of IT implementation and financial market deepening.
· Improving monetary policy transmission by resolving outstanding issues in the banking sector, further developing capital markets, reducing dollarization, and phasing out subsidized lending.
· Increasing transparency, for example, through the NBK’s intended publication of data on FX transactions on behalf of the NFRK, following recent outreach on factors affecting FX developments and changes in reserves.