FROM AUGUST 17 THE NATIONAL BANK OF KAZAKHSTAN WILL LOWER THE RE-FINANCING RATE FROM 22% DOWN TO 20%

/Almaty office of REUTERS, Aug.16, 99/ - From August 17 the National Bank of Kazakhstan will lower the re-financing rate from 22 percent down to 20 percent, said the chairman of the National Bank Kadyrjan Damitov on a press-conference today. "We reduce the re-financing rate based on the objective situation in the economy - rates in the money market have been reduced, inflation has decreased, and therefore, we thought it would be possible to reduce the re- financing rate", said Damitov. Before this, the National Bank reduced the re-financing rate on July 19 - from 25 percent down to 22 percent. Damitov said that the growth of world prices for products exported by Kazakhstan - oil, metals - which began in April and coincided with Kazakhstan's switch to floating exchange rate for tenge had created stable prevailing demand for currency in the domestic market. "In these conditions the National Bank was mainly buying the currency, replenishing its reserves. As a result, rates in the money market began to fall as well, inflation slowed down and all these gave us a reason to reduce the re-financing rate twice in last month", he said. In July inflation slowed down to 1.1 percent from 4.8 percent in June. In seven months inflation made 12.9 percent. In the first week of August, according to the National Bank, deflation of 0.2 percent was noticed.