Schizophrenic monetary policy authoritarian Belarus

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The blog is titled as William Moldyn analyzes on the website of the newspaper The Wall Street Journal last steps of the Belarusian authorities in an attempt to curb the currency crisis.

On Tuesday, the authoritarian leader of Belarus Alexander Lukashenko has weakened some of them imposed by financial constraints, allowing the exchange rate of the Belarusian ruble to fluctuate more freely — but only for banks and corporations, not individuals.

In a country where last year the police and KGB officers violently dispersed thousands of demonstrators protesting against election fraud, one is surprised that the financial freedom of companies, many of which are state-owned, is placed above the freedom of individuals. Under the rules of the national bank, the company will now be able to change currency at the exchange rate that goes beyond the previous corridor, and get, say, 4,300 rubles per dollar, while the ordinary citizen can get for a dollar in tightly controlled local banks, only about 3,000 rubles .

"They still do not allow people to buy at the rate of the interbank market. I think they are afraid to lose control and collide with the massive withdrawal of bank deposits. This makes some sense, "- said UniCredit Bank analyst Dmitry Gurov.

Minsk is doing everything possible to prevent the loss of foreign exchange reserves and the collapse of the banking system. Since the beginning of the foreign exchange reserves of Belarus decreased more than 20%. Recently, the National bank raised its refinancing rate to 13%, citing the need to keep the deposits in the banking system due to the rise in inflation in the consumer market.

However, according to the International Monetary Fund, inflation in This year, could still reach 12.9% due to the increase in the prices of manufactured goods and food to the weakening of the ruble.

Against the backdrop of fears of inflation and depreciation of the Belarusian ruble began to stock up on some key commodities — such as sugar, oil, or even the Minsk subway tokens. In response, the government restricted the number of tokens that can be purchased at one time.

G. Lukashenko may be able, thanks to the devaluation of the national currency, and other measures which he calls reforms to get loans in the amount of $ 3 billion from Russia and other allies that will prevent default or financial disaster. However, the image of Belarus as the "island of peace and stability" that his administration has created, in any way be affected, and his reputation in the country will start to go bad like his reputation abroad.

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