Markets – Kyrgyz interest rate cut is an outlier

DEC. 4 2022 (The Bulletin) — The Kyrgyz Central Bank’s decision to cut its interest rate for the first time since 2019 failed to dent the strength of the Kyrgyz som. It has surfed at around 84.5/$1 for several months now after falling to nearly 105/$1 in March, shortly after Russia invaded Ukraine.

The collapse and then recovery of the Kyrgyz som reflects a general trend throughout the year for currencies in Central Asia and the South Caucasus which all fell sharply after Russia’s invasion and then recovered when the economic fallout turned out to be limited.

Officially, Turkmenistan’s manat currency has remained stable throughout the year at 3.35/$1. Unofficially, it is a different story.

Opposition Turkmen media reported that the Turkmen manat strengthened on the Black Market for the first time since March after former president Kurbanguly Berdymukhamedov ordered exchange controls to be lifted. He is the powerful chairman of the upper house of parliament. 

On the Black Market, the Turkmen manat is now worth 18.5/$1, compared to 19.5/$1.


— This story was published in issue 530 of the Central Asia & South Caucasus Bulletin, on Dec. 4 2022

— Copyright the Central Asia & South Caucasus Bulletin 2022

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