According to Kazakhstan’s National Bank, amid the pandemic of 2020, it tried to fight low liquidity on the foreign currency market. In February, March, September and October the regulator spent $1.9 billion to support the national currency.
As the National Bank noted, the most dangerous time was in March at the beginning of the pandemic when the market crumbled and urgent support was needed. In that period, the regulator spent $1.488 billion.
To maintain control over foreign currency the National Bank has changed the rules for commercial banks that now are obliged to make preliminary examinations of the currency trading. This is necessary to ensure that the currency will be used appropriately within the legally established deadlines. To reduce the risk of black marketing, the regulator has set an exchange rate limit for foreign exchange shops. It means that the difference between sale and purchase prices should be minimal.
“Currency conversions to make secure transfers into state budget were an important factor toward balancing demand and supply on the foreign exchange market. The total amount of these conversions was $9.05 billion over the last year. Another factor was the sale of foreign currency by the quasi-public companies, which sold about $2.1 billion in 2020,” the regulator said.
Due to the more stable situation on the international and domestic markets the exchange rate of Kazakhstan’s national currency tenge rose by 6% if compared to the minimal rate of March and April 2020. At the end of last year, the exchange rate between tenge and the U.S. dollar was 420.71 KZT.
In 2019, when the Kazakhstan’s first president Nursultan Nazarbayev left office, the National Bank spent $304 million on national economy support.