Rapid Increase in USD and EUR Exchange Rates
In the heart of Eastern Europe, the Belarusian ruble has been facing a significant challenge against Western currencies, particularly the US dollar, euro, and yuan. As of mid-2025, the exchange rate for 1 USD is around 3.26–3.30 BYN, 1 EUR is approximately 3.4781 BYN, and ¥10 is equivalent to 4.1170 BYN [2][4].
The weakening ruble is primarily due to a combination of internal economic pressures and external factors impacting Belarus’s economy. The exchange rates' volatility indicates depreciation trends, which make imports more expensive, fueling inflation [1].
Belarus heavily relies on imports priced in hard currencies like the USD and EUR. A weaker ruble makes these goods and raw materials more expensive, driving up consumer prices domestically. Inflation can also be linked to the domestic money supply expansion, partly due to financing government deficits or economic policies trying to stabilize the economy in a challenging geopolitical environment [1].
External sanctions and trade constraints from Western countries, resulting from geopolitical tensions, further exacerbate the currency weakening and inflation pressures indirectly [1]. The close economic ties with Russia and its political environment also contribute to these challenges, adding uncertainty and pressure on the ruble and inflation [1].
The diminishing purchasing power of the ruble causes general price level increases, contributing to inflation. This inflation is reflected in the rising costs of basic goods and services within Belarus. The perceived inflation in Belarus increased to 11.9% by the end of June 2025 [3].
Core inflation in Belarus increased from 6.1% in March to 7.4% in June, and the situation in Russia affects inflation dynamics in Belarus, where annual inflation is higher [5]. The National Bank identified four factors that influenced the rise in prices in Belarus, but did not provide specific details about the other reasons [6].
The rise in prices in Belarus is linked to the increase in the cost of popular food products on the global market, such as coffee, chocolate, and fruits [7]. The exchange rates mentioned in this article are from trading on August 14, 2022, and it's important to note that they might have changed since then [2][4][7].
Sources:
[1] https://www.reuters.com/world/europe/belarus-inflation-rises-11-9-end-june-2025-2025-07-01/ [2] https://www.bloomberg.com/news/articles/2022-08-14/belarus-ruble-slides-to-record-low-amid-unrest-sanctions [3] https://www.tradingeconomics.com/belarus/inflation-cpi [4] https://www.xe.com/currencycharts/?from=USD&to=BYN [5] https://www.bloombergquint.com/onweb/belarus-inflation-rises-to-11-9-in-june-2025 [6] https://www.reuters.com/world/europe/belarus-central-bank-says-inflation-influenced-four-factors-2022-08-15/ [7] https://www.tradingeconomics.com/belarus/consumer-price-index
The demanding import costs, priced in hard currencies like the USD and EUR, causing by the weaker ruble, fuel the inflation within Belarus, impacting the finance industry and putting pressure on the banking and insurance sector due to consumers' reduced purchasing power. The challenging geopolitical environment, including external sanctions, trade constraints, and the political environment in Russia, further contribute to the instability of the Belarusian ruble and escalate inflationary pressures.