Tag Archives: currency

Currencies: Kazakh tenge and Azerbaijani manat

APRIL 28 2017 (The Conway Bulletin) — Softer oil prices have pushed down the value of the Kazakh tenge and the Azerbaijani manat. The tenge is now trading at 313.8/$1, its lowest value since March and the manat is trading at 1.665/$1, a two week low.

Oil has come off a high on April 11 of $56.23/barrel to be trading at around the $51/barrel mark. The main driver of the dip in oil prices is geopolitical concerns over US intervention in Syria and the spike in tension around the Korean peninsular. Both Azerbaijan and Kazakhstan are price takers and will have to settle for whatever the geopolitical machinations hand them.

On the equities front, it has been a very good fortnight for TBC Bank. It has ragreed a $100m loan from the EBRD to implement the so- called Deep and Comprehensive Trade Agreement with the EU. This is designed to boost trade between Georgia and the EU. TBC Bank’s share price has risen by around 20% this year and analysts are positive.

“Looking ahead, TBC Bank is expected to record a rise in its bottom line of 8% this year, followed by further growth of 14% next year,” said share analyst The Motley Fool. “When combined with its relatively low P/E ratio, this puts it on a PEG ratio of only 0.8. This suggests that more share price growth could be ahead for the company.”

ENDS

(News report from Issue No. 326, published on April 28 2017)

Panic fuelling monetary crisis, says Tajik CBank

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APRIL 13 2017 (The Conway Bulletin) — Tajikistan’s Central Bank said that panic speculation was driving up the cash exchange rate against the official rate to dangerous levels. The Reuters news agency said that the official somoni rate was 8.49 somomi/$1 compared to 8.9/$1 at cash exchanges. Tajikistan’s banking system has been teetering on the verge of collapse, only propped up by the government.

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(News report from Issue No. 325, published on April 17 2017)

Money changers still operate in Uzbekistan

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TASHKENT, APRIL 10 2017 (The Conway Bulletin) — Money changers still hawk for custom outside nearly all markets and shopping malls in Uzbekistan despite reports of a crackdown on the trade that has become a part of the Uzbek scene over the past 25 years.

A correspondent for the Conway Bulletin said that he had received around double the official Uzbek som/US dollar exchange rate on the Black Market. The Uzbek government has been devaluing the Uzbek som by around 1.4% per week since September last year. It now measures around 3,650 som.

Last month reports appeared that Uzbek police had been arresting money changers at some of Tashkent’s biggest markets. The Conway Bulletin correspondent, though, reported that money changers appeared to be operating with impunity, touting for business across the capital.

At rural markets, the correspondent said money changers carried wads of cash in bags and openly haggled with people looking to change som into US dollars.

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(News report from Issue No. 324, published on April 13 2017)

Currencies: Kazakh Tenge

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APRIL 13 2017 (The Conway Bulletin) — The Kazakh Tenge continues its upword trajectory this year and is now threatening to break through the psychologically important 310/$1 barrier.

It last breached this level at the beginning of December 2015, during the second devaluation of the year. After 310/$1 barrier is broken, analysts are confident that with oil pushing past $55/Barrel and the macro-economic picture improving, that it is only a matter of time before the next important level of 300 tenge/$1 is also breached.

It barely registered in October 2015 when the tenge fell past this level. Overnight on Oct. 10/11 2015, the tenge fell from 280/$1 to 307.5/$1. It kept falling in value as oil prices fell and by Jan. 22 2016 was valued at 381/$1. Since then, oil has improved from under $30/barrel, helping the economy to heal and pushing the value of the tenge up by 18.3% to 311.9/$1.

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(News report from Issue No. 324, published on April 13 2017)

Kyrgyz economy is improving, says C.Bank

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MARCH 27 2017 (The Conway Bulletin) — Kyrgyzstan’s Central Bank kept its key interest rate steady at 5%, half the level it was 12 months ago, citing an improvement in the economy and a slowdown in inflation. Importantly it said that the economy had grown in the first two months of the year and that the som currency had stabilised without the Central Bank’s interference. Currencies and economies in the Central Asia/South Caucasus region have been hit hard since 2014 by a recession in Russia and fall in oil prices.

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(News report from Issue No. 323, published on April 6 2017)

Currencies: Tajik somoni

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APRIL 6 2017 (The Conway Bulletin) — Tajikistan’s somoni currency keeps on hitting all-time lows. The Central Bank has managed a fall in its value since 2014 that has seen its worth half to 8.23/$1. At the start of 2014, the somoni was valued at 4.77/$1.

But, the rate of the fall may actually be good news. In July last year the Central Bank published a gloomy assessment of the somoni’s outlook. It said that the somoni would fall by 21% in 2017 and by another 8% in 2018. Of course there is some way to go, but in the first three months of the year the Tajik somoni has fallen just over 4%. This means that if the current fate of depreciation is maintain, the somoni will come in slightly better than expected.

Like the rest of the region, Tajikistan’s economy has been hit hard by the recession in Russia, it is officially the most remittance- dependent country in the world and most of this comes from Russia. The EBRD and the ADB have offered to help Tajikistan but require reforms.

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(News report from Issue No. 323, published on April 6 2017)

Uzbek authorities crackdown on money changers

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MARCH 21 2017 (The Conway Bulletin) — The authorities in Uzbekistan are trying to crackdown on Black Market money changers, the Eurasianet website reported. It described a raid by both undercover and uniformed police on money changers outside a major Tashkent supermarket. Under President Shavkat Mirziyoyev, in power since September, the Uzbek authorities have managed a careful devaluation of the som currency. The crackdown on the once thriving som Black Market, appears designed to coincide with this devaluation.

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(News report from Issue No. 322, published on March 27 2017)

Currencies: Georgian lari, Azerbaijani manat

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MARCH 27 2017 (The Conway Bulletin) — In a week of light trading and only incremental currency fluctuations, the Georgian lari performed strongest pushing up by 1.6% to 2.44/$1.

This is its highest level since the start of November last year and reflects a general strengthening of Georgia’s macro-economic scores.

Of the other currencies, only the Azerbaijani manat and the Uzbek som moved more than 1%. The manat continued its strong performance since February by moving up another 1.3% to 1.7050/$1, a five month high. Bloomberg described the manat as the strongest performing currency in the world this year. It also said, though, that ordinary Azerbaijanis still had little confidence in their currency after two devaluations in 2015 halved its value.

It said this lack of confidence showed through in Central Bank data which said 81.3% of bank deposits were now kept in US dollars, up from 79.6% at end-Dec.

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(News report from Issue No. 322, published on March 27 2017)

Inflation at correct level, says Kazakh Central Bank chief

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MARCH 13 2017 (The Conway Bulletin) — Kazakh Central Bank chief Daniyer Akishev said that he wanted to target inflation of 6-8% by the end of the year. It currently measures 7.8% which is down from a recent high of 17.7% in July 2016. Kazakhstan’s economy has stabilised after falling heavily in the previous couple of years, a drop linked to the fall in oil prices and tenge weakness.

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(News report from Issue No. 321, published on March 20 2017)f

Currencies: Azerbaijani manat

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MARCH 20 2017 (The Conway Bulletin) — The Azerbaijani manat continued its strong return to form, pushing up to 1.7286/$1 by March 17, its strongest level against the US dollar since the beginning of November 2016.

At its weakest point, the manat had been valued at 1.9517/$1 in February, meaning that it has strengthened by nearly 11.5%.

The European Bank for Reconstruction and Development (EBRD) has said that this manat strength is probably due to a transfer of 7.5b manat ($4.3b) from the SOFAZ, the state oil fund, to the Central Bank to boost the economy. The Azerbaijani economy has been looking fragile, because of the depressed price of oil, and it has needed the cash injection.

The Kazakh tenge and the Georgian lari also rose marginally in value throughout the week, although the Kyrgyz som and the Tajik somoni fell in value. The Kyrgyz som is surfing near its lowest point since mid-September 2016.

ENDS

(News report from Issue No. 321, published on March 20 2017)