Following September 10 trading, market exchange rate of KZT made 426.52 KZT per USD having lost 0.4% of its value for a week (from 424.85). EM currencies demonstrated versatile dynamics. At the beginning of the week, negative sentiment prevailed among global investors connected with concerns about spread of Covid-19. By the end of the week, reports of a telephone conversation between presidents of China and the US supported risk sentiment amid expectations of improved relations between the countries. The ECB announced at its regular monetary policy meeting that it would slow down pace of pandemic-related bond purchases amid sustained economic recovery in the region.

Exchange rates for currencies of emerging markets[1] demonstrated the following dynamics against the USD:

• South African rand gained 0.7% of its value (from 14.31 to 14.21) amid strong statistical data: surplus of country’s balance of payments reached a record high, over 5% of the GDP;
• Indonesian rupee appreciated by 0.4% (from 14,263 to 14,203) following announcements of negotiations between leaders of the US and China and hopes for improving relations;
• Mexican peso gained 0.2% (from 19.93 to 19.89), with almost no changes for a week;
• Russian ruble lost 0.5% of its value (from 72.8 to 73.19) amid falling interest of global investors to risk and rate hike less aggressive than analysts’ expectations. The Bank of Russia decided to raise the key rate by 25 bp to 6.75%;
• Indian rupee lost 0.7% of its value (from 73.02 to 73.5) in conditions of improving USD index and capital outflow;
• Brazilian real depreciated by 1.2% (from 5.19 to 5.25) amid exacerbating political tension expecting next year’s elections, in connection with escalation of tension in relations between President Bolsonaro and judicial body of the country;
• Turkish lira lost 1.8% (from 8.32 to 8.47) after a statement by governor of the central bank that it would pay more attention to analysis of base inflation which may become a tool to cut interest rates.

[1] most USD-traded currencies of emerging markets

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