Kazakhstan: We expect Fitch to confirm the rating at ВВB with a Stable outlook

During its scheduled review on Friday, June 17, we expect Fitch to confirm the sovereign rating of Kazakhstan at the BBB level with a Stable outlook. Such a decision could result from 1) the favorable environment on the energy market; 2) faster economic recovery than that expected by Fitch; 3) stabilization of the situation on the domestic FX market amid high adequacy of international reserves; and 4) a stable budget deficit despite upward revision of expenditures. We believe that confirmation of the rating at the current level with a Stable outlook is expected and thus will be neutral for Kazakhstan eurobonds.