Bloomberg||Kazakhstan’s central bank devalued the tenge by the most since 2009 as reduced bond buying by the U.S. Federal Reserve sparks capital outflows from emerging markets and the currency of its main trading partner weakens. The currency will trade at 185 per dollar, with a range of 3 tenge on either side, the Almaty-based National Bank of Kazakhstan said in a statement. That indicates a devaluation of 19 percent, based on the mid-point of the target band.
The tenge weakened to 184.52 per dollar at 6:31 p.m. in Almaty, compared with yesterday’s close of 155.63. The stock market rallied. The devaluation, which follows a 5.4 percent weakening of Russia’s ruble this year, will bolster the central Asian nation’s competitiveness and reduce speculative pressure on the tenge, the central bank said in an e-mailed statement today. Argentina devalued the peso in January and Ukraine imposed capital controls to stem a plunge in the hryvnia last week as the Fed’s stimulus reduction curbs global appetite for risk. Kazakhstan’s international reserves dropped to $24.5 billion in January from $24.7 billion a month earlier, the central bank said last week. They fell to $23.7 billion in October, the lowest since December 2009.
