Belarus may bring its refinancing rate, the world’s highest, to its lowest level since April 2011 by the end of next year as inflation slows, according to monetary-policy guidelines for 2013 approved by the government.
Subduing price growth and rebuilding gold and foreign-currency reserves will be the country’s main policy goals next year, the central bank, based in the capital, Minsk, said on its website today. The benchmark rate may be cut to between 13 percent and 15 percent, down from 30 percent as of Sept. 12, according to the regulator.
Belarus wants to increase its international reserves by $300 million to $700 million by the end of next year after meeting foreign debt payments, running a trade surplus and attracting $4.5 billion of foreign direct investment, according to the guidelines. The nation’s holdings, which shrank to as low as $3.59 billion last year, were at $8.14 billion on Sept. 1.
The former Soviet republic began to lower borrowing costs in February, cutting the benchmark rate eight times after raising it by a cumulative 34.5 percentage points last year to arrest capital outflows during a balance-of-payments crisis. Belarusian inflation slowed for a seventh month in August, decelerating to 55.6 percent from a year earlier after peaking in 2012 at 109.7 percent in January.