MAY 12 2017 (The Conway Bulletin) — Pledges to cut output and to support prices pushed up oil to $50.85/barrel, its highest in May, giving support to both the Kazakh tenge and the Azerbaijani manat. They both inched up slightly, with the tenge finishing on 315.54/$1, up nearly 1%, and the Azerbaijani manat hitting 1.6775/$1, also up around 1%.
As the graph shows, the tenge has risen by 8.6% since the start of November, giving the economy and the Central Bank much-needed breathing space. Gains since mid- February, though, have been limited and a deeper look at tenge shows that it has under performed against oil prices. The price of Brent oil has increased by 13.4% since the start of November, far outstripping tenge.
Of the other currencies, the long Victory Day holiday slowed trade and there was little movement, up or down, except with the Uzbek som. This is a tightly managed currency and the authorities have been slowing cutting its value to reflect a general slowdown in the economy. Once again, over the course of the last week, the som’s value has fallen by around 0.8%.
As for equities, it was also a fairly steady week with Centerra Gold gaining the most, up 7.5%. Caspian Sunrise stock is inelastic and changes tend to be wild.
ENDS
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(News report from Issue No. 328, published on May 12 2017)
