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Kazakhstan devalues currency amid banking crisis
By Polya Lesova, MarketWatch
Last update: 1:33 p.m. EST Feb. 4, 2009

NEW YORK (MarketWatch) -- Kazakhstan devalued its currency by about 18% Wednesday, as the mineral-rich, central Asian country struggles to contain a banking crisis and deal with the impact of tumbling oil prices.

The National Bank of Kazakhstan decided to allow the country's currency, the tenge, to fall by around 18%. The central bank set a new target rate for the tenge at 150 versus the U.S. dollar, allowing the currency to fluctuate within 3%, up or down, from that level.

The devaluation comes only days after the Kazakh government vastly expanded its role in the financial sector by nationalizing two of the four largest banks and taking 25% stakes in two other lenders. The move also follows currency devaluations in Russia, Ukraine and Belarus.

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