Tenge exchange rate: the prices for oil grew, back optimism — experts

Коронавирус: как эпидемия уже сказалась на мировой экономике

But experts believe that the current fall in prices will be temporary. According to professional market participants, by the beginning of March oil prices will rise to 57.7 dollars (median $58,5). But

a return to $70 per barrel is not expected even in the longer term

Anyway, the last forecast is the most pessimistic since at least the beginning of 2019.

“The financial market experts participating in the February survey, the average forecast that the Brent oil price after 12 months will be at $60,2 per barrel (median $61). Whereas the previous month, the annual forecast was at $64,6. Note, however, that if in January, experts predicted the decline of oil prices during the year, $1.4, now is expected to increase by $2,1,” — noted in the AFC.

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Dollar: optimistic more

Despite the fall in oil prices, the tenge is feeling OK. And against almost all currencies. The dollar for several weeks kept in the hallway 377-380 tenge. According to experts, in the near future to wait for a significant release beyond not worth it.

By the beginning of next month the rate of USD/KZT on average is expected to reach 380,26 tenge per dollar, while the median of expectations – 380 tenge. Exactly the same was the median during the January survey. That is, experts did not see during this time of major changes in the market that can move the course. Yes, and about the prospects for the year ahead they had optimistic view

“Experts have improved the medium-term expectations for appreciation of the tenge. So, the exchange rate of USD/KZT 12 months is expected to reach 388,5 tenge per dollar against its U.S. 389,9 tenge per dollar in the previous month,” — noted in the AFC.

This is at least April 2019. Moreover, both the average and median forecasts are down for the third month in a row, which also suggests growing optimism. But to rely on it is not necessary, because movement in the currency market depends on many circumstances.

For example, a year ago, experts predicted that the dollar exchange rate in February 2019 will be more 389 tenge, given that the actual cost at the time amounted to slightly more than 380 tenge. In fact failed not only to approach the value, but even guess the dynamics: for the year tenge has strengthened.

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Ruble: the dynamics began to change

Gradually returning optimism concerning the Russian currency. The median forecast for the 12 months decreased to 6.1 tenge at least 3 months. At the same level remains average forecast. That is, experts who in late 2019 forecast a continued strengthening of the ruble in the medium term I see the opposite trend now.

Interestingly, a year ago, the respondents did not see prospects for the growth rate in the coming year. Then the median forecast of 12 months coincided with an average of 5.7 tenge per ruble. With the current cost at that time was 5.8 tenge.

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Inflation: waiting for dilation

There is a unique situation: the average forecast for the year was below the current inflation rate. That is, the experts expect the slowdown in prices for goods and services. And this was not at least since the beginning of 2019.

“So, annual inflation in Kazakhstan in 12 months is expected to reach 5.5%, while inflation in January at 5.6%. Recall that

in January the price growth in the country in the next 12 months expected at 5.8%”,

— note in the AFC.

At the same level (5.8 percent) was to be the annual inflation rate in February 2020. At least that was the average and the median forecast from a year ago. As you can see, the experts have missed, though not by much.

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Base rate: opinions are divided

For the first time since may, the AFC survey clearly showed that experts expect easing of monetary policy. The median forecast for a base rate for the year ahead is reduced for the third consecutive month, reaching in February of 9.13%. The median remained at level of January – about 9%. However, unanimity among experts is not observed.

“The growing deflationary expectations lead to the fact that the majority of experts predict a decrease in the key rate of the national Bank in the next 12 months (66.7 percent). With 50% of respondents predict only a single reduction in the base rate. Meanwhile, 16.7% of respondents expected to maintain the base rate at the current level, and 16.7% predict a tightening of the DCT,” — noted in the AFC.

The next meeting of the Bank scheduled for March 16. The majority (61,1%) are of the opinion that the base rate will remain at the current level. Others believe that in March it will be reduced to 9% per annum.

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GDP: experts believe more growth

GDP growth of Kazakhstan by the end of 2019 4.5%. The rate of economic growth above expectations in 2019 led to improvements of growth forecasts in 2020. From a survey of the AFC, it follows that expectations for GDP growth in 12 months improved in February, from 3.9% to 4.1%.

“Recall that in early 2019, the government of Kazakhstan has forecasted GDP growth at the level of 3.8% and the world Bank had expected only 3.5%. Meanwhile, the national economy Minister Ruslan Dalenov at the government meeting on 11 February stated that the growth of GDP by the end of 2020 will be 4.7-5%,” — noted in the AFC.

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