Adrei TZALYUK, Informational agency of the financial markets �IRBIS� (Almaty)
ALMATY, April 29
(Specially for THE GLOBE)
Expectancies of a pre-holiday devaluation have already occurred. But are they strong and grounded? Let�s try to answer this question briefly.
A detailed study of the results of the exchange dollar auction on Thursday allows one to assume that the short-term liquidity of the banks is very different today. If we try to express this thought in a simpler way, we may say that the monetary mass in the correspondence accounts of the banks varies. Some banks have a lot of money, and they may significantly influence the dynamics of �tenge-dollar� rate. Others have lesser amounts. That is why at the auction on Thursday some banks could purchase large volumes of hard currency, while others could not afford that. Though everybody wished to buy.
The big banks were the first ones. The peculiar characteristic of the auction was that the largest volumes of dollars were purchased by those banks that sold the most dollars. Fulfilling the obligatory orders of their clients, the banks themselves bought the hard currency, though, most probably at their own expense, making their positions maximum long (i.e. �investing� maximum to dollar). This proves that the banks (they are trustworthy) expect the dollar rate to increase in the nearest future and are thus trying to protect themselves from devaluation. Besides, the banks do not like to stay �in tenge� for the weekend. It is better to convert tenge to hard currency, which is being saved in the accounts of the foreign banks, and to place this hard currency for the two days in the profitable financial instruments.
The reimbursement of the state securities increases the solvent demand of the banks on Friday. On Thursday, the reimbursement volume was 722.8 million tenge, on Friday � 1236.1 million tenge. Taking into consideration the results of the last placement of the state securities, the bonds of the National Bank (two auctions have been already cancelled), to reinvest this money to the state securities is not profitable in this week. Subsequently, we have only hard currency to deal with.
The observations mentioned above indicate that objectively the dollar rate will increase in the end of the week, and that on Monday it will last.
However, there are some other thoughts. It has been mentioned above, that not all the banks could purchase large volumes of dollars, though, they of course desired to do that, taking into consideration the explained motifs. Hence, there is not much tenge in the market to lead to the great growth of the dollar�s rate, much less to the collapse of the national currency.
The cancellation of the two auctions on placement of the short-term bonds of the NB is also meaningful. The auctions were cancelled because the investors (mainly banks) stipulated in their applications too high profitability. If the emitter had agreed to accept money at such an interest, the reimbursement of the securities would have been too expensive for him. The National Bank can ignore such circumstances when there is a sharp necessity to withdraw a definite mass of tenge for some time, which may create the panic demand for dollar. It has not been done. Most probably, the leading bank of the country possessing information regarding future inflow of the hard currency revenues to the site of KASE, does not consider it necessary to �sterilize� the free means. Taking into consideration that the intensive dollar�s growth is not profitable for the National Bank, we may come to conclusion that for the next two days they determined the �regulated� demand. Of course dollar will rise, but within the usual for the recent time limits.
There are some interesting thoughts concerning �cash� sector. On Thursday in the southern capital there were some cases when the dollar was not available in the exchanges, despite significant demand. Most probably, the exchanges will keep the hard currency until the holiday, as on Friday many people are supposed to receive their salary and bonuses. Of course, they will bring tenge to the exchanges. The dollar may be sold on Saturday and Sunday at a higher cost than they could on Thursday. The conclusion is obvious.
It should be mentioned that the behavior of the exchanges cannot influence at all, the results of the auction on Friday and Monday, as the banks should have executed the main purchase for �cash� (it usually takes two to three days to supply the hard currency from Germany and USA).
What does the phrase �within the usual for the resent time limits� mean?
In total, 190 transactions in US dollar were concluded at the auction on Thursday. The average rate was 114.60 tenge/unit. In comparison with the previous session, the average rate of the American currency increased by 0.51 tenge (51 points). The session volume was US$ 12.410 million, i.e. it increased comparatively with the previous auction by US$ 6.430 million. During the auction the rate fluctuation was 0.35%.
On the last Monday which was similar to the next Friday, as far as the prognosis of the rate-forming factors is concerned, the dollar at KASE increased by 1.11 tenge (111 points). The session volume was US$ 16.515 million.
BONN, April 29
(AFP)
German Chancellor Gerhard Schroeder said Thursday after meeting Russian special envoy Viktor Chernomyrdin that he saw �movement towards a political solution� on the Kosovo crisis.
He added that there had been a �certain rapprochement� of positions since the NATO summit in Washington last weekend.
Chernomyrdin arrived in Bonn earlier bearing what was described as new proposals on the Kosovo crisis.
He was to head for Rome later before holding talks in Belgrade on Friday.
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