If the current pattern of the national economy development continues through 2012, the ruble/dollar exchange rate is unlikely to exceed Br 8-8.5 thousand, stated the National Bank Governor Nadezhda Yermakova at a press-conference held during an information and study workshop for Belarusian mass media.
At the same time, the National Bank believes that the dollar should not drop below the Br8 thousand mark, although the national currency has recently approached this psychological threshold at several foreign exchange auctions. “The economy is now accustomed to these figures and would not feel comfortable in different conditions,” Ms Yermakova said.
Preliminary Q1 results show that the Belarusian economy is recovering after the last year’s foreign exchange and financial crisis. “The current situation is stable as foreign exchange sale exceeds purchase. In the past month, the National Bank would mainly make domestic currency interventions at the Belarusian Currency and Stock Exchange. We have purchased about $ 1 billion since early 2012, this money has been channeled to the gold and currency reserves,” stated the National Bank Governor. In its turn, active forex purchases led to a significant ruble liquidity surplus in the money market. According to the regulator, an extra Br 10 trillion are currently circulating in the economy, these funds will be gradually withdrawn. “Unfortunately, volumes of credit to the economy are lower than desired so far,” Ms Yermakova said. “We should encourage banks to lend to businesses and households rather than deposit their money with the National Bank”. The recent 2 percent reduction of the refinancing rate is not considered to be somewhat drastic. According to Ms. Yermakova, bank interest rates remain high enough to protect deposits from inflation. However, lower rates have affected the stream of depositors. “Households respond adequately. In March deposits grew not due to a net inflow, but due to accrued interest,” Ms Yermakova explained. The National Bank maintains that banks are no longer highly interested in raising household funds and are gradually lowering interest rates for their products.
Subsidized housing loans remain one of the most critical issues. According to Ms Yermakova, a series of alterations in this area is expected in the nearest future. At the moment, the much discussed Presidential Decree No. 13 is being amended. In particular, the provisions that regulate lending to the military will be revised. “Besides, we will continue lending to those borrowers who signed subsidized loan agreements under Decree No. 85,” promised the National Bank Governor.
