Putin discusses Russia’s economy growth with ministersBusiness & Economy September 24, 2:38
Lavrov warns against partition of SyriaRussian Politics & Diplomacy September 23, 0:00
Lavrov calls to coordinate Russian, US military action in SyriaRussian Politics & Diplomacy September 22, 21:05
Lavrov blames Obama administration for souring Russia-US tiesRussian Politics & Diplomacy September 22, 20:41
Waging war on Korean Peninsula inadmissible, says LavrovRussian Politics & Diplomacy September 22, 20:36
Russian Northern Fleet completes drills in ArcticMilitary & Defense September 22, 18:01
OPEC and non-OPEC countries to continue talks on oil production cut dealBusiness & Economy September 22, 17:28
Russian pair figure skaters Kavaguti, Smirnov retire from sportSport September 22, 16:48
Record number of delegations register for St. Petersburg-hosted IPU AssemblyRussian Politics & Diplomacy September 22, 16:47
MOSCOW, January 29. /TASS/. The Bank of Russia does not rule out Russia’s GDP will decline more in 2016 than assumed earlier in the base case scenario (0.5-1%) due to probably lower oil prices, the regulator said on Friday after its Board of Directors’ meeting on the key rate.
The GDP growth rate will be positive in 2017 but will remain low, the Bank of Russia said. According to the base case scenario of the Central Bank released last December, the GDP will decline 0.5-1% in 2016 and may grow up to 1% in 2017.
"Oil prices in 2016-2017 will probably be lower than assumed in the base case scenario. The floating rate will partly compensate the adverse impact of low energy prices on the economy. Nevertheless, further adaptation of the payment balance and the economy to lowered level of global prices on Russian export will be required. The GDP decline will therefore be more substantial than forecasted earlier in the base case scenario," the regulator said.
The period of additional adaptation of the Russian economy may take several quarters. According to regulator’s forecast, oil prices will be $50 a barrel under the base case scenario and $35 per barrel under the risky scenario.
The Bank of Russia does not rule out higher inflation and financial stability risks if low oil prices remain at a low level for a long time.
"If oil prices remain low for a long time, it will result in continued growth of inflation risks and risks for financial stability, and in the need of greater adaptation of the economy to new conditions. Long-term high inflation expectations may prevent slowdown of consumer prices hike. Balanced budget policy for the mid-term will be required to mitigate risks," the regulator said.
The Bank of Russia will act in advance and prevent threats to financial stability, Chairperson of the Bank of Russia Elvira Nabiullina said earlier. The Bank of Russia has all tools required to do so, she added. Financial stability indicators remain normal, the Central Bank told TASS on January 20.