Where Will The Dollar Exchange Rate Move Next: Currency Outlook
- 23.06.2025, 10:05
Forecast for the week.
Last week continued the trend towards strengthening of the national currency. The exchange rate of the U.S. dollar at the trades of the currency section of the BCSE in the middle of the week fell to another annual minimum of USD/BYN 2.9697. What will happen to the exchange rate this week, says financial analyst Mikhail Grachev in the traditional forecast on myfin.by.
The truth is that by the end of the trading five-day period, the decline in the dollar exchange rate corrected to USD/BYN 2.9781 and the total minus of last week amounted to -0.22%. By the beginning of the year, the Belarusian ruble is already strengthening against the U.S. dollar by -14.26%. The trading volume is slightly above average and amounted to $74.375 million for the week.
The exchange rate of the Russian ruble on the Belarusian fx market remained virtually unchanged, having increased by an insignificant +0.04% for the whole week. Although on Wednesday, June 18, the ruble rate on the Belarusian exchange also rose to RUB/BYN 3.7831, by the end of the trading week the rate returned to RUB/BYN 3.775. The trading volume was also quite high and amounted to RUB 25,201.300 million.
What affects the exchange rates?
What is the possible further movement of the Belarusian ruble exchange rate against major currencies? The answer to this question can be found in the results of two significant events of last week.
One of them is the meeting of the heads of the economic bloc on the margins of the St. Petersburg Economic Forum. Finance Minister Anton Siluanov, Governor of the Bank of Russia Elvira Nabiullina and Economy Minister Maxim Reshetnikov had a very thorough argument in a panel discussion.
The first two defended the idea of not getting involved in the problems of monetary policy, which continues to remain in a tight framework. Maksim Reshetnikov lamented the strong ruble and the losses of the budget and exporters from the strengthening of the Russian currency. The truth, as always, is in the middle, but so far it is still there.
Central Bank does not plan to let go of the reins and it is quite understandable. The high key rate keeps bank deposits at the same high levels and, in case of significant weakening of the ruble exchange rate against the US dollar, depositors will not keep their savings in banks, but will start to move to "bucks" en masse. Such a story is unlikely to please the banking system.
The case is approximately the same in Belarus, where the volume of deposits is growing, the dollar rate is going down, while individuals continue to withdraw from dollars to ruble deposits. The reverse process is possible if the dollar strengthens in the domestic market, but the banking system does not need it.
The second factor of the last week is the meeting of the FOMC committee of the U.S. Federal Reserve System held on Wednesday evening. The interest rate was predictably left unchanged, and all attention was paid to the results of the press conference of the head of the Fed Mr. Jerome Powell.
According to the results of the speech, the policy of monetary easing was shifted to the fall of 2025 (at best), the exchange rate of the US dollar in pair with the euro at one moment strengthened to EUR/USD 1.1453, but by the end of the week returned to the average values of the last month.
Weekly Forecast
It is not excluded that with the beginning of the current week the global financial market is expected to be shaken on the background of the escalation of the military conflict in the Middle East. Involvement of the United States in the conflict, Iran's threat to block the Strait of Hormuz, etc. may lead to a sharp jump in oil and gold prices.
The potential for growth of oil quotations and the beginning of the tax period in the Russian Federation will certainly support the ruble and further strengthening of the Belarusian ruble on the national currency market is not excluded this week. Thus, the slide of the exchange rate further below Br3 may continue.