Kazakh National Bank talks on reasons of tenge's weakening

By  Trend

The weakening of Kazakhstan's national currency tenge was the result of the depreciation of the ruble against the backdrop of increased risks of tightening sanctions against Russia and decrease in oil prices, National Bank of Kazakhstan said in a message.

Exchange rate of tenge dropped to the level of 354.06 tenges per dollar on August 9, 2018 or 1.6 percent compared with Aug. 8.

"This was a consequence of the ruble's depreciation amid increased risks of tightening sanctions against Russia and downturn in oil prices. Within a day Russian ruble weakened by 4.2 percent (from 63.6 to 66.3) against dollar and by 4.1 percent (from 73.8 to 76.8) against euro. Reason for the weakening of the ruble was information about the new bill of US senators on anti-Russian sanctions, which aims to restrict financing public debt of the Russian Federation and transactions with the property of a number of leading Russian banks. If the bill gets adopted, it may enter into force on August 22, 2018," the message reads.

The National Bank of Kazakhstan underlined that the current situation with the Russian ruble is mainly due to political factors and is based on the expectations of market participants.

"Price of Brent crude oil fell to $72 per barrel amid news about China's potential introduction of duties on American oil products. At present, exchange rate formation takes place without the participation of the National Bank of Kazakhstan. The National Bank of Kazakhstan is constantly monitoring the situation in the foreign exchange market and if necessary, is ready to implement interventions aimed at smoothing significant and destabilizing short-term fluctuations in tenge's rate," the message reads.

(348.59 KZT = 1 USD on Aug. 9)