Overheating of the Belarusian Economy

Belarus’s economy has recovered quickly from the 2022 downturn. In Q3 2024, the country's GDP exceeded the pre-crisis 2021 average by 3.4%. Economic activity has surged on the back of a stimulative domestic economic policy, the highest excess demand in Russia since 2008, and was accompanied by a rapid increase in consumer demand and wages in Belarus, a decrease in unemployment to record lows, and the highest level of capacity utilization in industry since 2013. This has sparked widespread discussion on the potential overheating of the Belarusian economy. Accurately diagnosing this potential overheating is critical for economic policy decisions and the prospects for improving the well-being of the country's citizens.