Beautiful building in belarus

Belarus Monetary Policy September 2018

Belarus: Central Bank keeps key rate at an over 10-year low in September

At its 19 September meeting, the Board of the National Bank of the Republic of Belarus (NBRB) kept the refinance rate unchanged at an over one-decade low of 10.0%. The Bank’s decision to hold the rate followed a cut in mid-June as was predicted by our Consensus.

Inflation dynamics were in line with the Bank’s forecasts, prompting its decision to refrain from further policy easing. After remaining at an all-time low of 4.1% in July, intensifying price pressures drove inflation up to 5.0% in August—although still within the Bank’s 6.0% cap—chiefly on the back of higher administered prices, including tariffs for communication services and retail prices for fuel. Meanwhile, in the face of an ongoing emerging-market selloff, the Belarusian ruble has largely held up against most major currencies. The NBRB also reaffirmed its inflation year-end inflation target of 5.5% plus or minus 0.5 percentage points.

In its communiqué, the NBRB signaled it expects rising domestic demand to only have a modest impact on inflation. However, the external sector’s backdrop poses significant upside risks to the Bank’s inflation outlook. These include an expected pick-up in inflationary pressures in Russia, due to capital outflows and a weakening currency; uncertainty over the impact of escalating global trade conflicts; and significant fluctuations in financial markets.

Inflationary pressures are expected to intensify slightly by the end of the year, and a rate cut therefore seems unlikely in the coming meeting. In the medium- to long-term, the NBRB remains confident that headline inflation will stabilize around its 5.0% target.

The next monetary policy meeting is scheduled for 19 December.

Free sample report

Access essential information in the shortest time possible. FocusEconomics provide hundreds of consensus forecast reports from the most reputable economic research authorities in the world.
Close Left Media Arrows Left Media Circles Right Media Arrows Right Media Circles Arrow Quote Wave Address Email Telephone Man in front of screen with line chart Document with bar chart and magnifying glass Application window with bar chart Target with arrow Line Chart Stopwatch Globe with arrows Document with bar chart in front of screen Bar chart with magnifying glass and dollar sign Lightbulb Document with bookmark Laptop with download icon Calendar Icon Nav Menu Arrow Arrow Right Long Icon Arrow Right Icon Chevron Right Icon Chevron Left Icon Briefcase Icon Linkedin In Icon Full Linkedin Icon Filter Facebook Linkedin Twitter Pinterest