NBB says refi rate might exceed forecast in 2013
MINSK. Jan 25 (Interfax) - The National Bank of Belarus (NBB) says that the refinancing rate could exceed the predicted 13%-15% at the end of 2013 due to the situation in foreign trade and the currency market.
"If a positive trend is consolidated in the economy the refinancing rate could drop to 13%-15% by the end of 2013. However, to ensure macroeconomic stability the refinancing rate may have to be higher. Refinancing rate dynamics throughout the year will largely depend on the macroeconomic situation, especially in foreign trade and on the currency market," a NBB press release says following Thursday's extended management session.
The National Bank said it will maintain "tough approaches to certain issues."
The refinancing rate was lowered from 45% to 30% in 2012 (30% since September 12 2012) amid a target forecast of 20%-23%. Inflation fell to 21.8% (the forecast was around 22%) from 108.7% in 2011. Despite ensuring the target forecast for inflation, the NBB explains that the refinancing rate forecast was not achieved "mainly because of the anti-inflationary focus of the National Bank's monetary-financing policy."
The NBB also said the increase in bank requirements on the economy pushed up the forecast.