Submitted by Tyler Durden on 05/23/2011 14:23 -0400

(http://www.zerohedge.com/article/belarus-just-devalued-its-currency-56)

When it comes to currency warfare, one can be polite and gentlemanly about it, like Brazil for instance, which every day, and sometimes on several occasions during the day, will proceed to buy dollars in an attempt to keep one's own currency lower. Or one can do what the Belarus central bank just did, and officially devalue one's currency, in this case the Belarus ruble, by 56% overnight, against every currency out there.

At this point, it sucks (that is a technical term) to be holding any exposure in BYR. Luckily for those who held their "money" in the form of gold and silver, they just got an instantaneous 56% value preservation and a relative boost in their purchasing power with just one central bank announcement. Also, any and all indebted parties who have BYR-denominated debts are throwing one big party tonight, as their debt was just cut by more than half. And yes, the Greeks are jealous with envy.


From Kommersant.ru:

The National Bank of Belarus (NBB) is sharply devaluing the official rate of Belarusian ruble. The exchange rate as of May 24 was set at 4,930 rubles per dollar. a decrease of 56% from the 23 May.

The National Bank of Belarus has officially confirmed a sharp depreciation of the currency. On its website it has published the official exchange rate of Belarusian ruble: $ 1 - Br4930 (a decrease of 56,3% to the rate on 23 May), 1 Euro - Br6914, 82 (a decrease of 53,1%), 1 Russian ruble - Br173 , 95 (a decrease of 53,9%). The official rate for May 23 was set at 3,155 rubles per dollar.

Earlier, the Belarusian authorities stated that in the near future a unification of the national currency will occur in two phases. "In the first stage decisions will be made to bring down the increased demand, and upon receipt of the loan rate will be formed on the basis of supply and demand, thus lowering the expectations today are still there," - said on May 20, Prime Minister of Belarus Mikhail Myasnikovich.

Meanwhile, representatives of Belarusian banks have criticized the mechanism of devaluation. "The problem is not in the specific value of the exchange rate and in the mechanism. The question is: under whose speculative decisions did the National Bank make this choice?" - Said the agency "Interfax-West" management representative of a bank with Russian capital. In this case, the representative of a state bank believes that "this decision should be viewed as an interim measure." According to him, "the trend is obvious: the official exchange rate will move in the direction of the OTC exchange rate, rather than vice versa."

Earlier, BNB announced the termination of containment of the Belarusian ruble to the retail market: from May 12 to lift restrictions on banks to buy and sell currencies population - 2% of the official rate.