* Stops supplying foreign exchange points
* Other foreign currency sales already halted
* Running out of reserves
* Businessmen say unofficial exchange rate has emerged (Adds c.bank confirmation, details, comments)
By Andrei Makhovsky
MINSK, March 22 (Reuters) - Belarus's central bank has halted foreign currency sales to local banks in a bid to save dwindling reserves, the bank said on Tuesday.
The former Soviet republic is running out of foreign currency reserves due to a large trade deficit, earlier overspending by the government and high demand for cash dollars and euros among the population.
The central bank this month halted most foreign currency sales to banks by requiring them to be booked 30 days in advance. It did, however, continue sales of foreign currency in cash for foreign exchange points.
But in a letter to local banks seen by Reuters on Tuesday it said an earlier document allowing for cash foreign currency sales was now cancelled. The central bank later confirmed the letter was valid.
"Banks now have to rely on their own long positions in foreign currency," said a Belarussian banker, speaking on the condition of anonymity. "(But) the reality is that banks have no long positions in foreign currency."
The central bank's foreign currency reserves shrank 20 percent in the first two months of this year to $4 billion and now cover just a few weeks of imports.
"BLACK MARKET" RATE EMERGES
Belarus has asked Russia and other former Soviet states for $3 billion in loans which officials say would help the country avoid the devaluation of the rouble but some analysts say it is still very likely.
Businessmen in Belarus say a "black market" exchange rate is emerging as banks offer dollars to them at a rate much higher than the official one.
"There have been cases when banks offered dollars at 3,700-3,800 roubles," said Viktor Margelov, a co-chairman of the Republican Confederation of Entrepreneurship, a business lobbying group.
The official exchange rate is 3,020 roubles per dollar. Some businessmen, speaking on the condition of anonymity, said they were also factoring a weaker rouble into their pricing policies and plans.
"Nobody wants to live on a gunpowder keg," said Margelov. "A planned devaluation would have been better than uncertainty." (Additional reporting by Nastassia Astrasheuskaya in Moscow; Writing by Olzhas Auyezov)