Experts of UFS Investment Company appreciated devaluation, carried out by the National Bank of Belarus. In this case, the possibility of further devaluation is practically ruled out by the Head of Fixed Income Research Department of analytics and company's risk management Stanislav Pismenni.
«We believe that this decision (the removal of restrictions on banks’ foreign exchange rates — Telegraf) won’t trigger further devaluation of the national currency, as the OTC Belarusian ruble rate doesn’t correspond to market rates and is currently equal to Br05.04 per dollar,» said Stanislav Pismenni.
In response to Telegraf about the possible developments in the foreign exchange market, UFS IC expert noted that market prices would reduce the speculative demand for currency, as well as strengthen the ability of Belarusian banks to meet the public demand for foreign currency and to complete the transition to an effective exchange rate. These measures, according to experts, will ultimately help create the conditions for increasing the state’s gold and currency reserves.
Besides, according to Stanislav Pismenni, the Belarusian leadership should keep on reforming. Among them, the expert called market currency pricing, reducing government spending and the tightening domestic monetary policy, as well as the conduct of a previously approved privatization.
«We cannot reliably estimate the needs of the economy in monetary resources, but we can say for sure that the implementation of measures of monetary policy to stabilize the situation in the money market, as well as gradual privatization, will gradually solve all the imbalance,» said Stanislav Pismenni.
Downgrading of Belarus’s Credit Rating to Negatively Affect Country’s Attractiveness, Investors
According to UFS IC expert, the recent downgrading of Belarus’s credit rating in the short term may adversely affect the country’s investment attractiveness.
«But in the medium term, the planned privatization, including the agreed sale of Beltransgaz, which is in its final stage, as well as EurAsEs loan and the necessary measures of monetary policy, which are now actively pursuing by the National Bank of Belarus, will fill the budget with the necessary resources and increase the attractiveness of Belarusian companies in the eyes of foreign investors,» said Stanislav Pismenni.
According to Telegraf, Standard & Poor’s international rating agency downgraded the credit rating of Belarus on local currency obligations from B + to B and placed it on CreditWatch list with negative implications, as well as placed the long-term sovereign rating of Belarus on foreign currency liabilities (B) and short-term credit rating on liabilities both in foreign and local currency (B) on CreditWatch list with negative implications.
