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Belarus c.bank halts sales of gold for roubles

April 15, 2011

Belarus c.bank halts sales of gold for roubles
Fri Apr 15, 2011 11:57am GMT Print | Single Page [-] Text [+]
MINSK, April 15 (Reuters) – Belarus’ central bank has stopped selling gold to local retail customers for Belarussian roubles BYR=, it said on Friday, after demand for precious metals soared due to expectations of a currency devaluation.

The bank did not explain its decision.

Belarus is in talks with Russia on a $3 billion bailout package that Minsk hopes will help it avoid a painful devaluation of the rouble and offset the large current account deficit.

Belarussians bought 470 kilograms of gold from the central bank last month, up from 209 kilograms in January and February together, as they sought to protect their savings.

Analysts say that Belarus will have to eventually devalue the rouble by about 20-30 percent even if it receives aid from Moscow. However, the central bank has said it would not make any such moves until late April.

The rouble traded at 3,052 per dollar on Friday BYR= and has weakened by 7.57 percent so far this year against a basket that includes the dollar, the euro and the Russian rouble.

The central bank has said it would keep the exchange rate movements against the currency basket within 8 percent this year. (Reporting by Andrei Makhovsky; Writing by Olzhas Auyezov; editing by Patrick Graham)
http://af.reuters.com/article/metalsNews/idAFLDE73E16O20110415

http://www.nytimes.com/2011/04/18/world/europe/18belarus.html?src=twrhp

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2 Comments leave one →
  1. April 18, 2011 02:42

    interesting part of bloomberg article: The scramble for hard currency has been driven in part by fears of an impending devaluation of the Belarus ruble, which the government keeps at a fixed exchange rate. Yet even under normal circumstances people here favor foreign currency for major transactions.

    Seems like something that is taking shape here in the US, or at least will.

Trackbacks

  1. BELARUS’ CENTRAL BANK STOPPED SELLING GOLD TO CUSTOMERS FOR ROUBLES, AFTER DEMAND FOR GOLD SOARED DUE TO EXPECTATIONS OF A CURRENCY DEVALUATION « InvestmentWatch

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