of December 31, 2017 No. 470
About approval of the Main directions of monetary policy of the Republic of Belarus for 2018
1. Approve the Main directions of monetary policy of the Republic of Belarus for 2018 (are applied).
2. To provide to National Bank together with Council of Ministers of the Republic of Belarus accomplishment of the Main directions of monetary policy of the Republic of Belarus for 2018.
3. This Decree becomes effective since January 1, 2018.
President of the Republic of Belarus
Approved by the Presidential decree of the Republic of Belarus of December 31, 2017 No. 470
1. Monetary policy will keep strategic orientation on ensuring price stability as basis of the sustainable and balanced development of economy of the Republic of Belarus.
Restriction of the inflation measured by consumer price index in the amount of no more than 6 percent (December, 2018 by December, 2017) will become main objective of monetary policy in 2018.
2. In 2018 carrying out monetary policy in the mode of monetary targeting will continue. The wide money supply will remain its intermediate reference point. The surplus of average wide money supply is predicted at the level of 9–12 percent (December, 2018 by December, 2017).
Within transition in the medium-term period to the mode of inflation targeting the operational reference point will be changed: since 2018 instead of ruble monetary base use of interest rate for daily interbank credits is provided in national currency.
3. The percentage policy will be pursued taking into account need of achievement of target indicator on inflation. When forming favorable conditions the orientation of percentage policy on gradual decrease in nominal interest rates in economy will remain. In real terms interest rates are planned to be supported at the positive level promoting growth of savings in national currency, to ensuring financial stability, sustainable development of economy.
Work on increase in efficiency of functioning of the percentage channel of the transmission mechanism of monetary policy by means of enhancement of approaches to liquidity management of banks and strengthening of coordination of monetary and budget policy will be continued.
4. The main instrument of regulation of current liquidity of bank system will be the regular transactions which are carried out on auction basis according to the approved schedule in the public market which parameters will be set proceeding from need of achievement of operational reference point.
5. Enhancement of course policy will be harmonized with transition to the mode of inflation targeting. The basis of this process will be constituted by further increase in flexibility of the national currency rate which dynamics will continue to be created under the influence of fundamental macroeconomic factors and measures economic, budget and tax and monetary policy.
6. Taking into account repayment by the Government of the Republic of Belarus and National Bank of internal and external obligations in foreign currency the international reserve assets for the end of 2018 will constitute at least 6 billion US dollars.
Due to reduction of amount of currency obligations and acquisition of foreign currency by National Bank in case of steady excess of the offer of foreign currency in the domestic foreign exchange market over demand for it improvement of structure of the international reserve assets will be provided.
7. The National Bank in 2018 will continue to exercise control of observance by banks of requirements to size and sufficiency of the normative capital, including due to implementation and gradual increase in value of the conservation buffer. Assessment of stability of banking sector will be carried out taking into account results of the independent quality evaluation of assets of banks and measures taken by banks following the results.
For decrease in level of systemic risks of banking sector and the prevention of their education implementation of practice of establishment of separate prudential requirements for the banks carried to systemically significant including increased requirements to sufficiency of their normative capital (the buffer of the system importance) is provided. For the purpose of restriction of the systemic risk resulting from deterioration in financial condition of the largest debtors (systemically significant borrowers) banks, the raised risk degree when calculating sufficiency of the normative capital of bank will be applied to their credit debt and securities.
8. Special attention is planned to be paid to ensuring safe and steady functioning of banking sector, including stabilization of situation with troubled assets of banks. For the purpose of decrease in the action of National Bank taken by banks of credit risk will be directed to increase in covering by banks by special reserves of the assets subject to credit risk.
9. Implementation of international standards of regulation and supervision of activities of banks will continue. For the purpose of improvement of the liquidity management of bank system directed to restriction of liquidity risk use of indicators of liquidity Basel by III as standard rates of safe functioning is provided.
The recommendations about the interest risk management of bank portfolio based on the updated standard Basel by II will be developed for enhancement of risk management in banks.
Development of new approaches to the organization complex risk - the oriented process of supervising assessment of banks (SREP), including the analysis of internal assessment of the capital (ICAAP) and liquidity is planned. Implementation of modern approaches will allow to estimate capability of banks to support the economic capital and liquidity at the level corresponding their risk profile and consequently, to resist to internal and external shocks.
10. The inspections which are carried out within supervision of banking activity will be oriented to timely identification of problem aspects in activities of banks for the purpose of initiation of efficient measures for minimization of their negative impact.
11. In 2018 effective, reliable and safe functioning of payment system by enhancement of the regulatory legal base, tariff policy on rendering settlement services, development of program and technical infrastructure, electronic document management, implementation of international standards, restrictions (decrease) of risks in payment system and carrying out supervision of it will be provided.
12. Further development will be gained by remote channels of bank servicing, single settlement and information space, digital banking technologies by means of development of interbank system of identification for rendering financial services to clients of banks and active use of electronic payment instruments and instruments of payment.
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