MINSK, 11 June (BelTA) - In an interview with the First News TV channel, First Deputy Chairman of the National Bank of Belarus Aleksandr Yegorov named the factors that led to Belarus' gold and forex reserves reaching record levels, BelTA has learned.
Belarus has reached a new historic high: as of 1 June, the country’s gold and forex reserves amounted to $11.158 billion. “What is more important is not the absolute value of the figures, but its ratio to our foreign trade. That is already 2.6 months of imports,” Aleksandr Yegorov said.
According to him, a combination of several factors contributed to the growth of gold and forex reserves. First, it is an investment policy: it is important to choose the right instruments for investing gold and forex reserves. Second, it is an interest rate policy for individuals. Third is an interest rate policy for legal entities, including reasonable restrictions on the money supply, which helps ensure balanced currency flows.
“The National Bank has pursued a consistent policy of investing part of its gold and forex reserves in gold. The rise in the price of gold per troy ounce since the beginning of the year has driven reserves up by approximately $1.1 billion. Overall, the growth was more than $2 billion. The second important factor was, of course, the purchase of currency on the domestic market. Here, several factors can be identified. First of all, it is a consistent interest rate policy, which shows the population that the Belarusian ruble is preferable to foreign currencies for savings. This has ensured net currency sales of just over $400 million by households since the beginning of the year. Another important factor is the net sale of currency by non-residents. This amounts to approximately $0.5 billion. It is worth mentioning that legal entities have also been providing a net inflow of currency into the country since April-May,” Aleksandr Yegorov said.
He also outlined the risks involved. “It is clear that if the price of gold has risen, it may also fall. But we believe that even if the price of gold does fall, there will be no significant reduction in gold and forex reserves below the levels specified in the presidential decree. We have a fairly good margin of safety in terms of reserves and in terms of pursuing a balanced monetary policy,” the specialist added.
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