Inflation in Belarus in 2017 could be lowest in ten years
According to Belstat, in August 2017, consumer prices fell by 0.8%, since early 2017, inflation was 5.3%. Prices in Belarus have been declining for two consecutive months, which was recorded for the first time since 1991. A seasonal decline in prices for fruit and vegetables is common in August due to harvesting season. Tariffs for housing and communal services are likely to continue to grow, currency exchange rate fluctuations unlikely to be significant, which should have a positive effect on the stability of import prices. A smooth reduction in discount rate should allow containing demand for Belarusian roubles from industry and trade and reduce inflation expectations. The lowest consumer inflation in the past ten years was recorded in 2010 at 7.8%. Should administrative regulation of inflation retain and oil prices remain high, by the year end, inflation in Belarus could be reported at 7%-7.5%.
President Lukashenka has met with the head of Chechnya Ramzan Kadyrov, who visited Minsk and the Minsk Automobile Plant. Minsk has always sought to have independent links with Russian regional elites, partially, to compensate for the Kremlin's diminishing interest in Belarus. In recent years, Belarus’ contacts with the Russian regions have been extremely intense. However, with some leaders of Russian regions, primarily heads of large republics, communication was more difficult to build. As many analysts in Minsk suggested, Minsk could regard contacts between President Lukashenka and the head of Chechnya as an additional communication channel for relieving tension in relations with the Kremlin. However, most likely, a trusting relationship with Kadyrov is a value for Minsk as such, provided Kadyrov’s broad business and political interests, and a high degree of autonomy for the Chechen leader from the Kremlin.