Belarus’ 2020 inflation to exceed NBB’s target of 5% - EDB
<p> MINSK, Oct 23 - PrimePress. Inflation in Belarus may slow down by the end of 2020, but its annual rate will be above the National Bank of Belarus’s target of 5%, reads the September macroeconomic review prepared by the Eurasian Development Bank (EDB). </p> <p> </p> <p> The document notes that inflation in Belarus accelerated to 6.1% in September from 5.6% a month earlier. The main contribution to the inflation growth was made by the core component, the growth of which is associated with the effect of the transfer of the ruble weakening and increased inflation expectations. The monthly core inflation rate (with seasonal factors eliminated) was estimated at 1%, slightly higher than in March 2020, and was the highest since February 2016. </p> <p> </p> <p> “Provided the exchange rate of the Belarusian ruble remains close to current levels for the rest of the year, a slowdown in monthly inflation can be expected, which, however, will translate into maintaining the annual rate above the target of the National Bank (no more than 5% in December 2020),” the review says. </p> <p> </p> <p> EDB experts point out that Belarus’ public debt increased to 35.1% of GDP by 1 September 2020 from 33.7% of the GDP at the beginning of the year, which is due to the increase in external liabilities from 27.1% to 28.6% of the GDP. This increase can be explained both by attracting government loans (mainly through placement of bonds on foreign markets) and by revaluation of foreign currency debts due to the weakening of the ruble. </p> <p> </p> <p> “The consolidated budget deficit, limited fiscal and foreign currency reserves and a tight schedule of public debt repayment in the medium term increase the risks to debt sustainability,” says the EDB macro review. </p> <p> </p> <p> As previously reported, Belarus saw 0.9% inflation in September 2020 and 4.7% in January-September. In 2019 Belarus’ inflation stood at 4.7% against the official forecast of 5%. The official inflation forecast for 2020 is also no more than 5%, although the National Bank of Belarus allowed its growth to 6%. End </p>
2020-10-24
Primepress
MINSK, Oct 23 - PrimePress. Inflation in Belarus may slow down by the end of 2020, but its annual rate will be above the National Bank of Belarus’s target of 5%, reads the September macroeconomic review prepared by the Eurasian Development Bank (EDB).
The document notes that inflation in Belarus accelerated to 6.1% in September from 5.6% a month earlier. The main contribution to the inflation growth was made by the core component, the growth of which is associated with the effect of the transfer of the ruble weakening and increased inflation expectations. The monthly core inflation rate (with seasonal factors eliminated) was estimated at 1%, slightly higher than in March 2020, and was the highest since February 2016.
“Provided the exchange rate of the Belarusian ruble remains close to current levels for the rest of the year, a slowdown in monthly inflation can be expected, which, however, will translate into maintaining the annual rate above the target of the National Bank (no more than 5% in December 2020),” the review says.
EDB experts point out that Belarus’ public debt increased to 35.1% of GDP by 1 September 2020 from 33.7% of the GDP at the beginning of the year, which is due to the increase in external liabilities from 27.1% to 28.6% of the GDP. This increase can be explained both by attracting government loans (mainly through placement of bonds on foreign markets) and by revaluation of foreign currency debts due to the weakening of the ruble.
“The consolidated budget deficit, limited fiscal and foreign currency reserves and a tight schedule of public debt repayment in the medium term increase the risks to debt sustainability,” says the EDB macro review.
As previously reported, Belarus saw 0.9% inflation in September 2020 and 4.7% in January-September. In 2019 Belarus’ inflation stood at 4.7% against the official forecast of 5%. The official inflation forecast for 2020 is also no more than 5%, although the National Bank of Belarus allowed its growth to 6%. End