Tenge to appreciate against dollar - Marchenko

business and economy

Tenge to appreciate against dollar - Marchenko

By SRI ⋅ January 14, 2010 ⋅

(SRI) - With oil prices on the rise, Kazakhstan expects the tenge currency to appreciate against the dollar this year, central bank chairman Grigoriy Marchenko said on Wednesday.

“The tenge will appreciate but not sharply,” Marchenko said at a news conference in Almaty.

The country devalued the currency in February last year by almost 20 percent amid economic turmoil caused by the near-collapse of some of Kazakhstan’s largest banks and falling oil prices. Since then, especially towards the end of 2009, the tenge has begun to appreciate, and the central bank repeatedly intervened to keep the currency within the official trading band of 148 to 151 per dollar.

Only in January of this year, the central bank has bought over $1 billion in the market to prevent the tenge from appreciating too fast.

That official trading band will widen on February 5 to between 127.50 and 165 tenge per dollar, a range the central bank will keep until March 20, 2011, Marchenko said in December.

Marchenko told reporters on Wednesday the central bank would manage a smooth transition to the new band and continue to curb fast rate movements.

“We see no need and no sense in sharp exchange rate swings,” he said.