Economic uncertainty to last for at least another 9 months: National Bank Governor

Speculations on a second possible wave of the global financial crisis will be persistent for at least another 9 months until the Bundestag election is over and Eurozone issues are resolved, Tengrinews.kz reports, citing the Kazakhstan’s National Bank Governor Gregory Marchenko as saying at a press-conference in Almaty July 4. “We have been talking of a possible second wave for the recent 15 months. Nothing has changed. According to the National Bank’s estimates, the economic uncertainty will linger for another 9 months. There are certain reasons for that. The Eurozone issues haven’t been resolved yet. There has been no final solution. A solution might be offered after the Germany’s Bundestag elections, that is in March 2013”, Mr. Marchenko believes. Depending on who wins the election, “serious compromises should be reached to settle the Eurozone issues”. “One of the reasons why lending operations haven’t been growing although banks do have high liquidity levels is that lenders have been wary of a second wave of the crisis for the recent 15 months”. A similar situation can be observed in the pension funds market, according to him. “Both pension funds and major exporters [the latter keep about $8 billion with banks, including foreign banks] do not invest into the nation’s industries, waiting for something dreadful to happen (…) consequently, the economy hasn’t been growing desirably fast“, he said. “A second major factor is the fiscal abyss, that is the issue of the US sovereign debt limits. The issue will only be settled after the US elections, that is early December”, he said.