Investors Resist 19% Yields as Kazakhstan Stifles Currency Gains
- Landesbank Berlin says tenge intervention curbs carry trade
- Central bank boosts yields at debt sales to lure buyers
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Kazakhstan may fail to lure foreign investors by dangling outsized returns on local debt if the central bank keeps standing in the way of the tenge’s appreciation, according to Landesbank Berlin Investment GmbH.
The monetary authority has about tripled the amount of notes offered at daily auctions in 2016 and boosted yields on seven-day debt to as high as 19 percent in April as it seeks to draw more investors locally and abroad and give banks incentives to pay high interest rates on tenge deposits. The country’s benchmark interest rate is 17 percent.