GDP growth stabilizes in January-September

GDP expansion repeats as one of fastest in over a decade: According to preliminary estimates, Kazakhstan’s GDP expanded by 6.3% year on year in January–September, the same growth rate recorded in H1, marking the joint-fastest pace since 2011 and exceeding the 4.5% pre-pandemic 10-year average.

Strong oil sector underpins GDP growth: Compared with the first half of the year, readings in January–September improved for the industrial sector (+7.3% yoy vs +6.5% in H1) and the agricultural sector (+4.4% vs +3.4% in H1). In contrast, readings worsened for the construction sector (+14.9% vs +18.4% in Q2) and the services sector (+5.2% vs +5.3% in Q2). Industrial production was buoyed by growth in the mining and quarrying sector, which reached a near-decade high, as the USD 48 billion Tengiz oilfield expansion continued to boost crude output. Less positively, the construction and services sectors were weighed by a diminishing impact of large public infrastructure and National Fund-financed spending and by decreasing real household incomes.

Economic growth to cool but remain robust: Our panelists expect economic growth to have peaked in the last two quarters and to begin trending downward in the coming quarters toward the 10-year pre-pandemic average of 4.5%. Persistently high inflation eroding purchasing power and elevated interest rates should weigh on domestic demand. For 2026 as a whole, GDP growth should fall to its lowest level in four years, albeit remaining solid. The deceleration is expected to be broad-based: Domestic demand will face headwinds from high inflation and slower consumer lending growth, while cooling oil production growth is set to weigh on exports. Crude and gas prices will be key to monitor, and further Ukrainian attacks on Russia disrupting Kazakh oil exports are a downside risk.

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