Siluanov: the fed’s decision could affect the budget situation of Russia

Siluanov: the fed’s decision could affect the budget situation of Russia


The US Federal reserve’s decision to raise rates had little impact on the ruble. Changes might affect the budget situation. Russia is ready for this, said the head of the Ministry of Finance of Russia Anton Siluanov.

MOSCOW, 17 Dec. Increasing of the rate may indirectly affect the budget situation of the Russian Federation, but the Russian government is ready to adequately respond to negative changes, said the head of the Ministry of Finance of Russia Anton Siluanov.

“We see that the change in rates had little impact on the exchange rate of our currency. Changes might affect the budget situation,” said Siluanov told reporters. However, according to him, among the countries with developing economy, Russia increasingly prepared to use such solutions.

“The budget will be affected only indirectly through the oil price, which fell today,” the Minister added.

The open market Committee of the Federal reserve system (FRS) the USA following the results of the next meeting for the first time since 29 June 2006 has raised the benchmark interest rate to 0.25-0.5% per annum with a record low of 0-0,25%. Thus, the mean value at the base interest rate is the 0.375% per annum. The regulator’s decision has coincided with expectations of experts.

“Our finances will be in minimum degree to respond to this change, because we have a fairly steady, large volume of reserves. We have reduced capital outflow,” — said Siluanov. He admitted that the fed decision may lead to a further decline in oil prices, however, according to him, it was predictable. “Such a change we were prepared,” he said.

“Indeed, next year we will need to take a number of actions relative to changing circumstances compared to those that were budgeted. We are now in the government are preparing proposals that will enable to respond adequately to changing conditions in the external environment, I mean primarily oil prices, and taking into account the appreciation of the value of American assets as a result of a rate hike by the fed,” said he.