IMF: Belarus rouble exchange rate inflated

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The decrease of the rouble exchange rate was very much behind the big difference in inflation rates with trade partners. Thus, the advantage in competitiveness gained earlier decreased. The nominal effective rouble exchange rate decreased by 3% last year. However, the high inflation rate (21.8% in 2012) resulted in an increase of the real exchange rate by 14%. It indicates that Belarus’ price competitiveness has worsened.

IMF experts also warn that the things should be interpreted with caution. The high level of state control in the Belarusian economy and the administrative interference into pricing weaken the role of price signals in comparison with market economy, according to pundits.