Deja vu: Dictator denies possibility of devaluation

The head of state accuses the opposition of spreading rumours about devaluation and redenomination.

“It is much talked, I don't know who stays behind this, about devaluation, denomination and so on. But you can see that our budget estimate deals with trillions of acting rubles and we don't forecast any evaluation, let alone redenomination,” Alyaksandr Lukashenka's press service quotes him.

“Go and explain to people that we will not have any devaluation. There's no need to devalue the national currency today,” he said. “We do not restrain the exchange rate. It is what it is. I said this to the National Bank chief after the appointment and I control it. If there are some talks about it among people, it's all due to our 'whistle-blowers', who begin to scare people.”

National Bank chief Nadzezhda Yermakova said keeping prices stable would be the key objective of the monetary policy in 2013. She named increasing the country's forex reserves to reach the level of economic security of the country as another important goal. The forex reserves are expected to amount to $8.7 billion keeping in mind the task to increase them to cover three months of imports (adjusted for its growth) by the end of the 5-year plan, BelaPAN news agency reports.

The National Bank will intervene in foreign currency sales and purchases only to prevent short-term sharp fluctuations, Yermakosa assures. She says the discount rate behavior will much depend on macroeconomic conditions, including those in the foreign economy sector and on the currency market. “The discount rate may fell to 13-15% provided that the current favorable and positive trends in the economy don't disappear and the inflate rate reduces. Its average in this case is estimated at 15-16%,” the National Bank chief said.

Lukashenka asked if the current interest rate policy leads to excessive debt load for enterprises, especially those working for the state and performing state's orders. Prime Minister Mikhail Myasnikovich said 11.5 trillion rubles would be spent on cheapening financial resources next year.

We remind both the dictator and the National Bank head denied the possibility of devaluation shortly before last year's crisis.