The National Bank of the Republic of Belarus raised its refinancing rate by 300 basis points to 30.00% from 27.00% on the 14th of September. The Bank said [translated]: "The consistent increase in the cost of borrowed money in the economy is intended to provide a further deterrent effect on customers' demand for credit resources of banks for the period of release on a single course. At the same time, increasing the refinancing rate will be an additional factor in stimulating processes of savings in Belarusian rubles and reduce pressure on the exchange rate".
The latest move marks a continued string of aggressive rate increases, with the Bank raising the refinancing rate by 500 basis points to 27% and 200 basis points to 22%. Belarus reported consumer price inflation of 36.2% in the year to June, according to the National Statistic Committee, meanwhile the government is forecasting 2011 inflation of as much as 39%. The USD-Belarussian ruble exchange rate has double on the black market, rising to as much as 7,000 per dollar (approx. 6,000 in July), and currently trades around 5350 against the US dollar.
www.CentralBankNews.info
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