Analysts Concerned About Belarus Escalation, United Russia Leverages Putin Support

LOCAL NEWS

• Recent polls place United Russia support at 27%, the lowest level in 13 years ahead of 17-18 September Duma elections.
  • This week UR launched the new slogan "We are team Putin. We are United Russia" to harness Putin's higher 57% approval rating
• Analyst warns Belarus is "teetering on the bring of a dangerous escalation" following Western sanctions as he no longer has anything to lose.
  • Notes US sanctions seem to be the most painful for Minsk, but yet more sanctions loom for Belarus over the impending migrant crisis with EU leaders meeting on 18 Aug to discuss the issue.
  • Latvia, Poland and Lithuania have noted high refugee flows from Minsk, which Lukashenko has threatened to increase if the EU continues to tighten sanctions.
  • Moreover, joint drills with Russia (Zapad 21) will also keep EU and NATO tensions elevated
• CBR says it may decide to revise its inflation target by mid-2022. In July, Nabiullina recalled the experience of a number of countries, which, like Russia, started with a target of 4%, then lowered the target to 2-3% - which could lead to a decrease in inflation expectations

Data:

• 1700BST: 2Q GDP exp at 10.0% vs -0.7% prior