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National Bank expects its refinance rate to average 16 to 17 percent in 2014

The National Bank of Belarus (NBB) says in an explanatory note on its draft 2014 Monetary Policy Guidelines that the refinance rate is expected to average 16 to 17 percent next year.

The NBB says that it plans to keep the refinance rate at a level necessary for achieving price stability in the economy and meeting the inflation target, and that the rate will depend on the situation in the domestic and external markets.

The National Bank does not set any specific targets for lowering the refinance rate in the 2014 Monetary Policy Guidelines, whereas the Guidelines for 2013 provided that the refinance rate should be 13 to 15 percent by the end of the year.

The NBB has reduced the refinance rate four times this year: from 30 to 28.5 percent on March 13, to 27 percent on April 17, to 25 percent on May 15 and to 23.5 percent on June 10.

The National Bank refrained from lowering the rate any further in July and August following an increase in demand for foreign currency, an outflow of rubel deposits and their conversion into foreign-currency deposits. //BelaPAN