Kazakhstan's tenge exchange rate strengthens in October

By Trend

The volatility of tenge [Kazakhstan's national currency] will be dependent on the changes in the geopolitical scenario and situation in the world markets in the future, Trend reports citing the National Bank of Kazakhstan (NBK).

"According to the results of October, tenge exchange rate strengthened by 1.7 percent, to 468.23 KZT/1 USD. The average daily trading volume on the Kazakhstan Stock Exchange increased from $91 million to $121 million over the month. The total trading volume amounted to $2.4 billion," NBK said.

"The sales of foreign exchange earnings by entities of the quasi-public sector during the past month amounted to about $528.6 million. Companies of the quasi-public sector independently carry out sales in the foreign exchange market through second-tier banks," NBK informed.

The sales of foreign currency exchange to ensure the transfers from National Fund in the republican budget amounted to $362 million in October. The share of sales from the National Fund amounted to 15 percent of the total trading volume, not more than $30 million per day.

The National Bank of Kazakhstan adheres to the principles of non-interference in the formation of market trends and is a price-takes when carrying out transactions for the sale of currency from the National Fund. The Bank also doesn't place its own orders for the sale of currency but satisfies existing orders submitted by market participants in order to maintain current conditions on the foreign exchange market. This practice allows for minimizing the influence of operations from the National Fund on the foreign exchange market.

National Bank informed that there were no foreign exchange interventions in October. In addition, the Bank didn't carry out transactions for the purchase/sale of foreign currency for pension assets of the Unified Accumulative Pension Fund (UPAF) and other funds held in trust.

"The volatility of tenge will depend on the changes of geopolitical scenario, expectations of domestic participants and the situation on world markets. National Bank of Kazakhstan will continue to adhere to the flexible exchange rate regime, which eliminates the accumulation of imbalances and ensures the safety of gold and foreign exchange reserves," NBK said.