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Belarus past short-term effect of Western sanctions, central bank believes

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MINSK, 27 January (BelTA) – The short-term effect of Western sanctions against Belarus is over, the inflation peak is behind us. First Deputy Chairman of the Board of the National Bank of the Republic of Belarus (NBRB) Sergei Kalechits mentioned it as he delivered a report during an expanded-participation session of the central bank’s board, BelTA has learned.

Sergei Kalechits said: “Today we see that the short-term effect from the sanctions is over and the peak of high inflation is behind us. The consumer price index and trend inflation are steadily decreasing. According to our estimates, year-on-year inflation will reach single-digit figures by the end of Q1 2023.”

In 2023 the government and the central bank have to slow down inflation to 7-8%. “It is important to limit the influence of pro-inflation factors with joint efforts as much as possible. Moreover, the inflation environment will become more favorable in the absence of new shocks. The work Belarusian enterprises do to optimize costs and accelerate import substitution will help reduce the intensity of inflation processes by a lot. The decreasing volatility of the Belarusian ruble’s exchange rate against the Russian ruble, the normalization of inflation processes in Russia, an acceptable level of prices for imported energy resources and the stabilization of the cost of raw materials on international markets will have a favorable effect on it,” the official noted.

Apart from that, in view of the tighter monetary policy of leading economic centers the external pro-inflation background is expected to decrease. In turn, it will reduce the influence of imported inflation.

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