Non-restrictive monetary conditions and an increase in fiscal stimulus provided significant support to domestic demand in Q2-2026
The National Bank cut key rates by 0.5 p.p. in Q2-2026 and did not withdraw excess bank liquidity at auctions in order to stimulate domestic demand. Credit and deposit market interest rates on average maintained a non-restrictive character, but the differentiation of lending and saving conditions for businesses and households remained significant. The rapid expansion of lending under preferential programs and the increase in budget financing of investment generated high money supply growth, which was accompanied by an increase in the money overhang. Its inflationary consequences manifested in an acceleration of the GDP deflator to 13.6% YoY in Q2-2026, but were contained by price control and strengthening competition in goods markets for consumer inflation. The high ruble savings rate of households also limited the inflationary effects of unbalanced money supply growth and supported the stability of the Belarusian ruble exchange rate.
Monetary conditions will maintain a non-restrictive character in 2026–202. Stimulation of domestic demand will retain its priority status for the National Bank. The regulator may allow some decline in real interest rates amid a moderate acceleration of inflation following the easing of price controls from July 2026. The Belarusian ruble exchange rate in basket-of-currencies terms will move close to its equilibrium trajectory in 2026–2027, provided that net foreign currency sales by households are maintained.