The speaker: the decision to float the ruble exchange rate was absolutely right


BEIJING, November 10. The decision to float the ruble exchange rate was absolutely right, reason for devaluation shocks today. This opinion was expressed to journalists by the Minister of economic development of Russia Alexei Ulyukayev.

“I think this decision (relating to a floating rate) was absolutely correct and made in a difficult environment, I appreciate the leadership of the Bank of Russia in this direction,” he said.

According to the speaker, this question is complex, and it is associated with providing currency refinancing, and with exporters.

“But now we see that the current account balance is fairly stable, on capital account improves. So I think that the reason for any devaluation expectations or shocks today, no,” he added.

About inflation

Inflation in Russia in 2015 (December to December) can be 12,7-12,8%, according to Ulyukayev.

“We are now 11.2% of accumulated inflation. If weekly inflation to 0.2%, as it was the last time, it means that somewhere in the 12.7-to 12.8% at year-end,” said he.

On key rate

The speaker sees the potential to reduce the key rate of the Central Bank to single-digit level in the first quarter of 2016.

“I maintain my assessment,” he said.

GDP

The fall of Russia’s GDP in October in annual terms amounted to 4%, in relation to the month-to-month seasonality recorded a slight increase, said the speaker.

“In October, in annual terms the decline was quite deep – about 4 per cent,” he said.

As previously reported, the GDP of Russia in September in annual terms amounted to 3.8%.

The economic development Minister added that in October showed a slight growth with the removed seasonality from month to month.

“There is indirect evidence, is the loading on the Railways and electricity consumption in October, about the same as in September. That is a very little growth month-on-month over month seasonally adjusted and in annual terms is still a decline,” – said the Minister.

By year-end, the MAYOR predicts a drop in GDP of 3.9%.