Central Bank Governor on the Tenge strengthening

Kazakhstan’s National Bank bought $1.2 billion in the internal market in February not to let the national currency (the Tenge) strengthen, the Bank’s Governor Gregory Marchenko told March 6 at a press conference in Almaty. He added that “there were virtually no interventions in January”. Currency intervention, also known as exchange rate intervention or foreign exchange market intervention, is the purchase or sale of currency on the exchange market by the monetary authority, i.e. the central bank, in order to influence the value of the home currency on the foreign exchange market. According to the National Bank, the tenge strengthened by 0.6% in February, with the exchange rate standing at 147.74 tenge per $1. Mr. Marchenko elaborated that the $1.2 billion were purchased by the Bank mostly from exporters selling their foreign currency-denominated revenues. “The external conditions for Kazakhstan, a commodity exporter, are extremely favorable”, he said. The Bank’s Governor emphasized that the annual inflation rate of 4.7% as of March 1 is the lowest since March of 1999, with the average rate standing at 7.3%. He attributed that to the Government’s efforts to bridle prices for fuel.