Economic expectations in the elections’ aftermath

A week after the Parliamentary elections, the election campaign stopped being part of Belarus’ public life. Devaluation and inflation expectations of the population moved to the forefront.

The population responded to the completion of the election campaign with negative economic expectations. Most of all, the population anticipates the weakening of the national currency and the US Dollar exchange rate growth. According to the chairman of the National Bank Nadezhda Ermakova, “there was an increase in the demand for cash currency in September”, but in her opinion, there was no reason to be concerned. Mrs. Ermakova said that the elections were held, and there were no major changes. Therefore the situation with the “devaluation” and “inflationary” expectations of the population has stabilized…

Simultaneously, our assessment demonstrated that people’s moods in the regions are rather the opposite of the statements made by the National Bank Chair. The general trend is that the population is anticipating deterioration of the living standards and economic situation. The population is mentally prepared for the further growth in food prices, utilities, gasoline, and so on. The President’s promise of USD 500 salaries has been perceived either neutral or negative due to lower purchasing power.

Currently, mass discontent can only be provoked by extremely sharp deterioration in living standards. If current trends continue (step by step increases in prices for goods and services) further growth of pessimism and demoralization in society should be expected. Combined with the low level of trust in the authorities it may result in a certain socio-political tension in the country in the future, similar to the situation at the beginning of 2011.