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For the weakening of the ruble, the Finance Ministry decided to purchase 616 billion

The Ministry of Finance submitted the budget amendments, which suggests that in 2017 the mission of the Agency will be bought currency in the amount of 616 billion. It is necessary to replenish the Reserve Fund, the amount of which has fallen below 1 trillion. On buying foreign currency will go the extra revenues from exports of hydrocarbons. Another objective of these operations is the attempt of the officials to weaken the exchange rate of the domestic currency. However, additional money from export of “black gold” for these purposes is clearly not enough. Therefore, it is likely that the Central Bank may return to a policy of currency interventions. Then the “wood” is in danger of slipping to 70 rubles per dollar.


photo: Natalia Muslinkina

Relatively high oil prices are kept more than six months. Despite the failures, the barrel stays above $50. Accordingly, the Russian currency is on a kind of resort. Typing for 2016 and beginning of 2017 decent weight the dollar exchange rate during this time fell from 83.6 to 57.5 ruble, she doesn’t want to give up and because of oil, expects more.

In connection with such a favorable confluence of events, the Ministry of Finance decided to review the budget for 2017 in which the average of quotations of “black gold” is scheduled at $40, and increase the projected volume of revenues of almost 1.15 trillion rubles. The Minister Anton Siluanov has calculated based on the new forecast of economic development, which has adjusted its estimate of economic growth from 0.6% to 2%. Additional revenues must be the result of the revival of business activity in Russia and the average price of oil not less than $45,6 per barrel.

Despite the fact that the budget seeks additional funds to cover expenses with minimum losses for reserve sources, officials remain dissatisfied with the financial situation. In the first place — a high exchange rate, which, in their opinion, detrimental to the growth of the economy. Anton Siluanov, as well as his other colleagues on the Cabinet of Ministers, constantly talking about the overvaluation of the Russian currency by 10-12% and the need to lower its price to 64 to 70 rubles per dollar.

While the economic bloc does not have this effective weapon. Oil prices increasingly depend on international circumstances — the upcoming summit of OPEC in Vienna, which will be decided on the issue of extending Memorandum of reduction of oil production. While most forecasts speak in favor of this decision, so from this side of the “wooden” there is no reason to fall in price.

Undertaken by the Ministry of Finance own steps for the correction of the ruble will also fail. Purchased by the Bank of Russia at the request of the Ministry since the beginning of the year currency in the amount of $4 billion was not the cause for the collapse of the Russian currency. But the Finance Ministry is not giving up. Part of the additional revenues that the state receives from the sale of oil, may as well go for the purchase of dollars. The total size of the monetary investment in this direction will be 616 billion.

In dollar terms — about $10.5 billion According to analyst GK “FINAM” Timur Nigmatullin, this is not enough for large-scale collapse of the value of the ruble. “In addition, the Ministry of Finance has no right to enter the open market and forced to carry out operations through the Central Bank, which in theory can sell the currency reserves, without intruding on the open market”, — the expert believes.

Meanwhile, currency reserves of the Central Bank are not limitless. There is a certain probability that the regulator will still have to go back with currency interventions in the stock markets. The head of the Bank of Russia Elvira Nabiullina said that it was possible after Russia to achieve the inflation target of 4%. The growth rate of consumer prices has dropped to this level. According to senior analyst “Alpari” Anna Bodrova, it forces to carefully monitor the mood of the Central Bank. “The regulator never came out with interventions on the open market in 2015, although currently the conditions are similar to those under which he had previously been active in the regulation of rates”, — says the analyst.

If this happens, the ruble going down. Earlier for creating exchange rate balance, the Central Bank splashed into the market to an average of $1.2 billion daily. Returning to these rates, the regulator can create big trouble for those who continue to believe in the Russian currency: its value can collapse down to 70 rubles per dollar. According to the chief of analytical Department UK “BK-Savings” Sergei Suverov, punters can lose interest in the ruble as an investment tool and shift their savings in the currencies of other countries, for example, pounds sterling or yen, which are currently a relatively attractive asset.

However, to lay the blame for such a failure is likely to be no one. Both the Finance Ministry and the Central Bank can always say that buying currency to replenish the Reserve Fund.

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