Kazakhstan’s service sector activity saw a renewed rise in January, following a marginal drop in December, according to purchasing managers’ index (PMI) data released by Freedom Holding and S&P Global on February 5.

The figures “indicated a positive start to the year across Kazakhstan's service sector. Activity growth was renewed following a slight fall in the month prior, supported by a solid uptick in new business. Furthermore, firms accumulated workers at a faster pace, with the latest round of job creation the strongest seen since August 2022. However, growth of the sector was accompanied by a further intensification of price pressures, with both input costs and output prices increasing at sharper rates than in December,” the accompanying statement issued with the PMI data said.  

The seasonally adjusted PMI services index for January grew to 51.3 from 49.7 in December (any reading below 50.0 indicates a contraction in business activity).

Yerlan Abdikarimov, director of the financial analysis department at Freedom Finance Global (100% subsidiary of the Freedom Holding), commented: "Kazakhstan's services sector closed the first month of the year on a wave of optimism, overcoming the December slump thanks to strong growth in new orders, which also contributed to one of the highest rates of growth in payroll numbers since the series began six years ago. Along with the recovery in business activity, the market faced an acceleration in inflation, driven by high raw materials and logistics costs, as well as increased currency risks.”

“Following cost inflation, which turned out to be the most pronounced since March last year, market participants increasingly shifted the burden of expenses to buyers. Sector representatives significantly improved their forecasts for the coming year on expectations of growing demand, business expansion, the launch of new projects and hopes for an improvement in the geopolitical situation," he concluded.