BMW to resume premium car deliveries to RussiaBusiness & Economy January 17, 15:48
Russia to appeal ECHR decision on illegitimacy of Dima Yakovlev lawRussian Politics & Diplomacy January 17, 15:40
Record-breaking KAMAZ trucksBusiness & Economy January 17, 15:37
Russian PM says up to $1.8 bln to be earmarked to prop up economy in 2017Business & Economy January 17, 15:35
Lavrov says tensions in Balkans growing, standoff must be preventedRussian Politics & Diplomacy January 17, 15:16
Russian top diplomat: Moscow denies worship of Western liberal valuesRussian Politics & Diplomacy January 17, 15:04
Russia to replace carrier rocket engines after Progress cargo spacecraft crashScience & Space January 17, 14:59
Lavrov blasts Voice of America’s report on alleged Russian hacker attacks as ‘lie’Russian Politics & Diplomacy January 17, 14:46
Lawyer says ECHR decision gives US applicants chance to adopt Russian orphansWorld January 17, 14:25
MOSCOW, January 24. /ITAR-TASS/. Over several days in January, the rate of the Russian ruble fell down to almost the minimum of four years as on Thursday it went below 34 rubles for a dollar and 46 rubles for a euro. While the ruble rate lowered by 7.12 percent over the entire year of 2013, within ten days in January it lost 3.49 percent, thus almost having reached a forecasted annual rate.
Over several past years, the ruble rate against dollar went down in the crisis February 2009 below 36 rubles, RBC daily writes. The euro top exchange rate was above 46.8 then.
Experts name several reasons for weaker ruble - the policy of the Central Bank, the low growth rate of the Russian economy and the Federal Reserve System’s curbed quantitative easing measures. By the yearend the dollar may cost up to 40 rubles, the daily writes.
Experts say it is clear for the market that following the Central Bank’s policies the ruble rate will continue declining.
“The Central Bank has been declaring its plans to have a floating ruble rate, and now we can see the actions which prove the intention: the financial regulator has been expanding borders of the bi-currency basket’s corridor and cutting on currency interventions,” RBC daily quotes Absolut Bank’s head of trust management department Ivan Fomenko. He says another reason for weaker ruble is slower economic growth: the trade balance in December reduced to 1.5 percent of the GDP, which is the lowest rate since 2008-2009.
“It is a rather local tendency, which will last for next couple of weeks. And afterwards ruble’s slump will slow down, and it will come to a certain balance point,” Professor of the Higher School of Economics Alexander Abramov told Novye Izvestia.
The Komsomolskaya Pravda recalls the Central Bank announced on January 19: we are not going to continue supporting the ruble rate any longer. Formerly, the Central Bank spent great funds in currency, but that’s it. From now on, the market will dictate the rate. The Central Bank’s first deputy chairperson Kseniya Yudayeva announces: we have completed a stress test of the banks, and it is clear they will survive if the ruble rate declines by another 30 percent. This does not mean we are expecting fluctuations of the kind, she added though. Thus, Russia is facing a hard blow. The country’s share of imported consumer goods is about 40 percent, while the nation gets wages in rubles (“Weak ruble is good for the budget and for the oil producers”).
However, the Russian authorities do not seem to be concerned about this state of affairs, Nezavisimaya Gazeta writes. Right on the contrary, they believe the floating falling ruble rate may be favorable for the Russian economy. “The freer is the Russian currency, the better it will be in the long run, as it will make the economy react more effectively and timely to the processes in it,” the newspaper quotes President Vladimir Putin as saying.
Besides the international reasons, the slump has also domestic reasons, Vedomosti reports. “A too slow economic growth caused by unattractive ratio between capital’s risks and revenues as well as by institutional factors - are fundamental reasons for slumping ruble not only this year, but over the coming years,” the newspaper quotes as saying HSBC’s chief economist in Russia Alexander Morozov.
The Ministry of Economic Development forecasts ruble in 2014-2016 will be declining both nominally and realistically, the newspaper stresses.
Opponents of the continuing devaluation now feature even the ministry of economic development, which has always criticized the Central Bank for too strong ruble: the sectors competing with the import make only a fourth part of the entire production, thus too weak ruble will not help the economy, on the contrary - it will have a negative influence on it.
Itar-Tass is not responsible for the material quoted in these press reviews