The National Bank has announced an increase in the value of the dollar.

The National Bank of Kazakhstan has released a statement regarding the current situation with the tenge exchange rate, reports IA “NewTimes.kz”.

The financial regulator noted that by the end of November, the tenge weakened by 5%, reaching 512.52 tenge per US dollar. The average daily trading volume on the Kazakhstan Stock Exchange decreased from 278 to 262 million US dollars over the month. The total trading volume amounted to 5.5 billion US dollars.

“Currency sales from the National Fund to support transfers to the republican budget in November amounted to 1,260 million US dollars. The share of sales from the National Fund accounted for 23% of the total trading volume and no more than 60 million US dollars per day. In conducting operations with the National Fund's resources, the National Bank adheres to the principle of market neutrality, which implies regular and uniform sales of foreign currency,” the National Bank emphasized.

According to preliminary forecast applications from the government for the allocation of transfers to the republican budget, the National Bank expects to sell currency from the National Fund in December 2024 in the range of 800 to 900 million US dollars.

“In line with the previously announced plan, considering that the share of foreign currency assets of the Unified National Pension Fund (ENPF) is about 40%, the National Bank did not purchase US dollars for the investment portfolio of pension assets in November. Currency purchases in December are also not planned,” the financial regulator continued.

At the same time, to enhance the balance of the currency market, on November 19, 2024, in accordance with the resolution of the Government of Kazakhstan, the norm for the mandatory sale of 50% of foreign currency earnings by entities in the quasi-state sector was reinstated. Quasi-state sector companies independently conduct sales on the currency market through second-tier banks.

“As part of the implementation of the government’s decision to purchase shares of JSC ‘Kazatomprom’ for the National Fund, the National Bank carried out a conversion in July by selling part of the currency assets of the National Fund into the gold and foreign currency reserves of the National Bank. To maintain market neutrality and mirror this operation in the currency market, the National Bank began uniform sales of the acquired volume from mid-July. In November, the volume of sales from the National Bank's gold and foreign currency reserves under this operation amounted to 133.8 million US dollars. Thus, in November, the currency sale as part of the mirroring of the transaction for the purchase of shares of JSC ‘Kazatomprom’ was completed,” the National Bank noted.

They also clarified that there was an increase in demand for foreign currency from economic agents in the domestic currency market, alongside limited supply, particularly against the backdrop of the exchange rate surpassing a psychological threshold.

“Against the backdrop of a deterioration in several fundamental factors, to prevent destabilizing fluctuations, smooth excessive volatility of the tenge exchange rate, and ensure the supply of foreign currency, the National Bank conducted currency interventions from November 15 to 28. The total currency sale for the month amounted to 1,047 million US dollars,” the National Bank reported.

As the National Bank added, in the short term, the dynamics of the tenge will depend on market participants' expectations, quarterly tax payments, the situation in global markets, and changes in the geopolitical landscape.