Moscow. November 3. The CBR admits that oil prices will remain low for a long time.
“There was not just the fall in oil prices, but, apparently, occurs, the structural transformation of the oil market, which will lead to the fact that rates can stay low for a long time. Many even speak of the end of the so-called oil “super cycle”, – the head of the Bank of Russia Elvira Nabiullina during the discussion of the single monetary policy in the Duma.
According to her, the possibility of monetary policy (DCT) in order to foster economic growth is limited because the decline now due to a combination of the so-called cyclical and structural factors, the role of structural factors will gradually increase.
The Central Bank of the Russian Federation in the baseline scenario of the forecast expects that Russia’s GDP by the end of 2016 will continue to decline, but the beginning of quarterly GDP growth is expected in the middle of next year and by the end of 2017 will be a slight increase.
In his speech Nabiullina also noted that he sees no problems with currency liquidity. “The measures that we took at the end of last year, we believe it is justified. Inflation has stabilized, financial markets have also stabilized, and this allowed us to reduce rates, including foreign currency refinancing. Decreased demand for foreign currency liquidity, now problems with foreign exchange liquidity is not” – said Nabiullina.
Last Friday, the CBR decided to keep key rate at 11 percent, citing persistently high inflation expectations.