Gold And Foreign Currency Reserves Of Belarus Decreased By One Third Of Billion U.S. Dollars

The regime is left without a "safety cushion".

Foreign exchange reserves of Belarus continued to decline in February and, according to preliminary data, amounted to $7 billion 114.5 million in equivalent as of March 1, 2021, naviny.online reports with reference to the National Bank.

"In February 2021, the gold and foreign currency reserves of Belarus decreased by $88.9 million (1.2%), having been reduced by $265 million (3.5%) in January," - the report of the National Bank reads.

At the beginning of the year, Belarus' reserves amounted to $7.468.5 million. Thus, they have decreased by 4.7%, or $354 million since the beginning of the year.

According to the National Bank, the level of reserves "decreased in February as a result of the scheduled repayment of foreign and domestic government obligations in foreign currency in the amount of about $250 million". In addition, selling foreign currency on the domestic market by the National Bank contributed to the reduction of reserves.

"The demand for foreign currency on the domestic market was mostly caused by implementing measures for transferring loan debt of some companies from foreign currency to the Belarusian rubles," - the National Bank specifies.

In February, the level of foreign reserves was supported by the inflow of foreign currency to the budget, including from selling government bonds nominated in foreign currency on the domestic market.

The regulator reminds that according to the main directions of the monetary and credit policy for 2021, the international reserve assets must amount to no less than $6 billion by the end of the year.

In January, First Deputy Chairman of the National Bank Siarhei Kalechyts noted at the expanded board meeting that another decrease in reserves is expected in 2021 in connection with the need to pay the state debt of $3.3 billion.

"In current economic conditions, the projected decline in foreign currency reserves to a value equivalent to at least two months of imports of goods and services does not bear excessive risks for macroeconomic stability," - the first deputy head of the National Bank assured.

In 2020, the international reserves decreased significantly - by $1.9 billion, or 20.5% (at the beginning of 2020, they were $9.4 billion).

Last year, the reserves decreased significantly twice: by $1.018.4 million in March and by $1.399.8 million in August. The reduction of the reserves was caused by the strengthening of depreciation expectations, which, according to economists, were triggered by the pandemic in March and the political crisis in August.