National Bank of Belarus Chairman Raman Halouchanka explained the reduction of the refinancing rate by citing slowing inflation. Today, the regulator decided to lower the rate by 0.5 percentage points to 9.25% per annum from June 1.
“In making this decision, all factors were analysed, starting with actual and expected inflation, the level of business activity in the country, the situation in the foreign exchange and lending-deposit markets and ending with the external environment and its possible future changes”, Halouchanka said at a briefing following the board meeting.
He identified slowing inflation as the primary factor.
“Since the second half of last year, a trend toward slower inflation has begun to take shape. At the end of 2025, annual consumer price growth amounted to 6.8%, following a peak of 7.4% in July. Inflation continues to decline steadily this year.
Over the first four months, consumer prices increased by 2.5%, compared with 3.8% a year earlier. As a result, annual inflation slowed to 5.4% in April. As we had forecast, this is practically the lowest figure for this period over the past two years.
The core component of inflation also declined. In April this year, on an annual basis, it amounted to 5.9%, compared with 7.6% in June last year.
Trend inflation — that is, inflation excluding short-term shocks — is currently estimated at around 5%, whereas in the second half of last year it exceeded 6%.
In our assessment, slower inflation is the result of both external and domestic factors. External conditions have become more favourable, causing prices for imported goods to rise less intensively. In particular, annual price growth in Russia slowed to 5.6% in April this year, compared with 10.2% a year earlier.
Indicators characterising economic processes within the country also point to a gradual reduction in pressure on consumer prices. This is reflected in more moderate growth rates of key macroeconomic indicators than last year”, Halouchanka said.
He also noted stable conditions in the deposit market. Belarusians are increasing savings. Balances on deposits with maturities of more than one year increased by more than 2 billion Belarusian roubles, or 19%, in January–April this year. The National Bank chief also pointed to a rising share of Belarusian roubles in broad money.
According to him, lending growth remains moderate and is not creating conditions for price pressure. Banks have sufficient resources to meet demand for loans.
“According to our forecast, which takes into account the decision announced by the board today, average monthly core inflation rates will remain low until the end of this year. Annual core inflation will remain close to 5%.
At the same time, inflationary pressure from the economy will remain near neutral levels, and an additional positive factor will be the expected slowdown of inflation in the Russian Federation, our main trading partner. Taken together, these factors, as well as the projected balance of risks, determined the scale of the current adjustment to National Bank interest rates”, he said.
Raman Halouchanka declined to comment on the regulator’s further plans.
“It is too early to make any statements on this. We will see how the economy responds to today’s decision, how the external environment develops and how sustainable macroeconomic processes in our economy prove to be. Therefore, there are always two options. As you understand, if developments remain favourable, we do not rule out returning to this issue again this year”, he concluded.