KZT/USD Exchange Rate Dynamics

According to the National Bank of the Republic of Kazakhstan (hereinafter the NB), on 17 March 2025, the exchange rate stood at 505.2 KZT per USD. The exchange rate depreciated by KZT 56.6, or 12.6% year-on-year (as compared to 17 March 2024). The exchange rate weakened by KZT 9.9, or 2.0% month-on-month (compared to 17 February 2025).

Chart 1. Average Monthly USD/KZT Exchange Rate Dynamics

At the beginning of January 2025 (i.e. on 1 January), the official exchange rate was 525.11 KZT per USD. In the first two weeks of this year, the national currency continued to experience moderate depreciation, reaching its peak of 530.24 KZT per USD on January 15, 2025. The rise in the exchange rate at that time can be attributed to external factors, including fluctuations in global energy prices, as well as internal factors such as the specifics of monetary policy and a seasonal increase in demand for foreign currency from certain economic agents.

However, by the end of January and early February 2025, there was a gradual reversal of the trend, with the tenge beginning to appreciate, declining from around 530 KZT per USD to approximately KZT 510–520. For example, on January 25, the exchange rate was KZT 517.84, and by February 8, it had dropped to KZT 511.18. The most notable strengthening was recorded in the second half of February, when the exchange rate reached around KZT 495, reflecting a more substantial decline from the peak values in January. On 15 February 2025, the official exchange rate was 495.28 KZT per USD and continued to fluctuate between KZT 495 and KZT 505 in the following days. The factor contributing to this appreciation was, in particular, a more active monetary policy aimed at reducing inflation expectations and mitigating speculative pressure on the foreign exchange market. Moreover, a moderate increase in export revenues and a slight decrease in import costs during this period contributed to a greater supply of foreign currency and growth of market confidence in the domestic currency.

Chart 2. Dynamics of Foreign Trade Relations from January 2021 to January 2025

The reasons for such volatility of KZT/USD exchange rate are of a complex nature. On the one hand, the exchange rate was influenced by internal macroeconomic factors, including inflation rate, the key interest rate, and actions of the National Bank of the Republic of Kazakhstan, which at the beginning of the year focused on maintaining financial market stability and preventing sharp exchange rate fluctuations. On the other hand, external factors also played a significant role, particularly changes in the global economy and oil prices. Given that Kazakhstan is a major exporter of commodities, a rise or fall in energy prices can directly affect the foreign exchange market by determining the supply and demand balance for foreign currency. Furthermore, continuing global financial uncertainty, fluctuations in international investor interest in emerging markets, and geopolitical events could put additional pressure on the exchange rate.

Table 1. Exchange Rate Forecast 2025

Source: the NBRK data, BCC Invest analysis

Current dynamics indicate that in January of this year, the pessimistic scenario factors were realized to a greater extent, while since February, the optimistic scenario factors have been taking effect. As a result, the average annual exchange rate currently stands at 509.5 KZT per USD, which is close to the optimistic scenario forecast of 511.2 KZT per USD.

All else being equal, favorable trends are expected to continue in April, allowing the exchange rate to remain relatively stable.