Changes in purchasing power with inflation | FinReview
Research
27 December 2018

Changes in purchasing power with inflation

In the first quarter of this year, for the first time since the crisis, the growth in the purchasing power of wages was recorded in the Republic of Kazakhstan – by 2% from the same period a year earlier. Recall that the annual growth of the average monthly nominal wages in Kazakhstan amounted to 8.7% in January-March 2018, while prices in the consumer market increased over this period by 6.6%. Thus, the solvency of the Kazakhs went to growth.

For comparison, earlier, from 2015, the purchasing power of wages fell in a row for three years. So, for example, by the end of 2017, wage growth was only 5.5%, with the inflation rate just 7.4% at once, that is, the purchasing power of the salaries of Kazakhstanis declined by 2016 by 1.7%.

Taking into account the growth of purchasing power, and, accordingly, the solvency of Kazakhstan, a surge in demand for goods and services in the consumer sector is likely, as well as an increase in demand for banking products, such as deposit, aimed at preserving and multiplying the released funds, and credit, aimed at meeting growing demand.