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Foreign Exchange Market 

(December 2007) 

 

 

 

In the first three weeks of December, the USD exchange rate was mainly increasing. The increase of USD exchange rate was first of all caused by the increased demand for foreign currency on the part of commercial banks used for the payment of clients import contracts. Then, starting from the Christmas holidays the demand for USD distinctly reduced and its exchange rate decreased as well.  

 

 

The monthly weighed average USD exchange rate in the inter-bank currency auctions increased by 2.1 per cent and amounted to 35.2709 KGS/USD as of the end of December. The USD accounting rate increased by 2.3 per cent and reached 35.4988 KGS/USD.  

The total volume of transactions in the currency auctions in the reporting month decreased compared to the previous month by 27.2 per cent and made USD 56.3 Million. This decrease occurred due to the reduction of the National Bank transactions by 59.4 per cent down to USD 22.3 Million, while the NBKR purchased USD 17.7 Million and sold USD 4.6 Million. At the same time, the volume of inter-bank transactions in currency auctions increased by 50.6 per cent and reached USD 34.1 Million. 

 

 

The dynamics of the USD exchange rate in exchange offices was mostly similar to its dynamics at the currency auctions, but fluctuations in the cash segment were distinctly higher. Over the month, the average weighed USD selling rate in exchange offices increased by 3.0 per cent, up to 35.5361 KGS/USD. The average December USD exchange rate in exchange offices was by KGS 0.02 higher than the weighed average rate in the inter-bank currency auctions. A daily average fluctuation of USD selling rate in exchange offices increased from 0.10 to 0.18 per cent, and the average margin on USD buying/selling transactions increased from 0.32 to 0.45 per cent. 

The EUR exchange rate dynamics in the currency exchange offices, as usual, formed under the influence of its variations at the external markets: during the month, the exchange rate was fluctuating within the range from 50.94 to 51.68 KGS/EUR and only in the end of the month it started stabilizing. The monthly weighed average EUR selling rate in exchange offices increased by 2.4 per cent and amounted to 52.1993 KGS/EUR as of the end of December. A daily average fluctuation of EUR selling rate increased within the month from 0.12 to 0.30 per cent, and the average margin on buying/selling transactions increased from 0.51 to 0.63 per cent. 

 

 

The RUB selling rate in currency exchange offices during the first ten days of December was mainly increasing and then it was fluctuating till the end of the month within the range 1.42-1.44 KGS/RUB. Over the month, the weighed average exchange rate of RUB increased by 1.48 per cent, up to 1.4273 KGS/RUB as of the end of the period. A daily average fluctuation of RUB selling rate increased from 0.06 to 0.23 per cent, and the average margin changed slightly from 0.77 to 0.78 per cent. 

The KZT exchange rate in currency exchange offices was mainly increasing during the first twenty days of December, then after decrease during the Christmas holidays it fluctuated within the narrow range. Over the month, the average weighed KZT selling rate in exchange offices increased by 2.2 per cent and amounted to 0.2908 KGS/KZT as of the end of December. The daily average fluctuation of KZT exchange rate increased from 0.11 to 0.24 per cent, and the average margin increased from 0.86 to 1.04 per cent during the month. 

The total volume of currency buying/selling transactions in currency exchange offices in December decreased by 1.9. per cent as compared to November and amounted to KGS 2,342.9 Million. The decrease occurred in all currencies except for transactions with RUB, the shares of which increased up to 13.9 per cent. As a result, the shares of transactions with USD went down to 63.7 per cent, with EUR down to 10.0 per cent, the share of transactions with KZT remained at the level of 11.8 per cent. The share of transactions with other currencies in the structure of currency transactions reduced from 0.7 to 0.6 per cent.