Kazakhstan devalues its currency

Kazakhstan's central bank Tuesday devalued its currency -- the tenge -- by about 19% against the US dollar, local media reported.

The bank will allow a new exchange rate of 185 tenge to the dollar, Xinhua reported citing a statement from the National Bank of Kazakhstan as saying.

The exchange rate was 155.5 tenge for one US dollar one day before the announcement.

The depreciation of tenge would benefit the economy of Kazakhstan in the long term, said the central bank's chairman Kairat Kelimbetov.

According to him, the authorities of the country have enough resources to support the new exchange rate and protect the economy from any sharp swings in tenge.

"Intervention in the foreign exchange market will be conducted in order to smooth fluctuation of the tenge exchange rate, without affecting the formation of the general trend defined by market preconditions," said Kelimbetov.

The statement said the recent devaluation of ruble in Russia, which Kazakhstan holds as a reserve currency, also contributed to the decision to devaluate tenge. Kazakhstan last devalued its currency in 2009.