Gradual depreciation of national currency unlikely to boost demand for currency from population
According to the National Bank, in June 2017, private rouble deposits increased by BYN 22.4 million, despite the BYN depreciation against the US Dollar by 3.7% per month. The US Dollar rate for the Belarusian population is a marker for estimating the volume of own savings; sharp changes in the exchange rate of the national currency significantly boost the demand for hard currency. Lower inflation and strengthening of the Belarusian rouble in January – May 2017 reduced devaluation risks of the population. The volume of private rouble deposits in the banking system is likely to decline due to lower interest rates on deposits. Interest rate policy on deposits is unlikely to change due to excess liquidity. A significant increase in corporate demand for rouble funds is unlikely due to the persistence of stringent requirements by banks to clients’ solvency. The major risk is a possible weakening of the Russian rouble, which makes 50% in the basket of currencies. Should such risks materialise, the National Bank would strengthen the national currency, in order to reduce the growth rate of the US Dollar and Euro to the Belarusian rouble.
The Belarusian authorities regard the Catholic conference as yet another international event to promote Minsk as a global negotiating platform. Minsk’s proposal to organise a meeting between the Roman-Catholic Church and the Russian Orthodox Church is rather an image-making undertaking than a serious intention. However, the authorities could somewhat extend the opportunities for the Roman-Catholic Church in Belarus due to developing contacts with the Catholic world.
Minsk is attempting to lay out a mosaic from various international religious, political and sportive events to shape a positive image of Belarus for promoting the Helsinki 2.0 idea.
Belarus’ invitation to the head of the Holy See for a meeting with the Patriarch of the Russian Orthodox Church should be regarded as a continuation of her foreign policy efforts in shaping Minsk’s peacekeeping image and enhancing Belarus’ international weight. The Belarusian authorities are aware that their initiative is unlikely to find supporters among the leadership of the Russian Orthodox Church in Moscow. In Russia, isolationist sentiments prevail.
In addition, for domestic audiences, the authorities make up for the lack of tangible economic growth with demonstrations of growth in Minsk’s authority at international level through providing a platform for religious, sportive and other dialogues.