As of this morning there's a 20% off sale on your travel to Kazakhstan. Well sort of. The Kazakhstan Central Bank announced a devaluation of the Kazakh tenge this morning. News spread fast. Notwithstanding the recent interest in the Sochi Winter Olympics, the national television networks had their top story for the day. ATM's around Astana were switched off and some businesses screeched to a halt as they reevaluated their pricing. Our primary grocery story seemed to be operating business as usual with no changes as of yet. What will tomorrow bring?
For us, the devaluation may have a limited effect on our lifestyle here as we live off an income stream of US dollars. The effect on many of the locals many be less forgiving. Local friends and colleagues have effectively lost 20% of their tenge denominated savings. Although I have observed that the country operates on a semi-parallel currency system with many ATM's dispensing either US Dollars or Kazakh Tenge, this seems to be more the case for those with real estate and other hard assets of foreign origin.
What will happen to my 35 cent loaf of bread, my 40 cent bus fare or my one dollar yogurt? It looks like they will cost more tenge.
Have you lived in a country during a currency devaluation and have tips to share?
