The Finance Ministry predicted a minimal impact of the fed’s decision on the budget and the ruble

Moscow. December 17. The decision of the Federal reserve system to increase the rate of the Federal credit will have no impact on the Russian budget and will have almost no impact on the ruble, says Finance Minister Anton Siluanov.

“What does it mean for Russia the rate increase? Our finances will be in minimum degree to respond to this change, because we have large reserves, we have reduced the outflow of capital. (. . .) The budget will not have an impact on the ruble is practically no effect,” he said.

The Minister explained that the impact on the budget of the Russian Federation may be only indirectly through the price of oil, which is now “several fell in the result of investments in U.S. investments become more attractive than investment in other assets, including investments in oil assets in oil futures”.

“Such a change were predictable, such changes take place we were prepared. 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 economic environment, by which I mean primarily the price of oil and the condition of rise in cost of American assets as a result of the fed rate hike,” said he also.

According to Siluanov, the rate changes can affect the situation with the budgets of countries with developing markets. But Russia, he said, are better prepared to use such solutions because it has a steady current account surplus of the balance of payments.

The CBRF also believes that the fed’s decision to raise will have a major impact on the ruble, but it will help to reduce volatility in the market.