Bloomberg named commencement date of buying foreign currency by the Central Bank

The Bank of Russia may start buying dollars on the market already in February-March,
to absorb the additional budget revenues from exceeding projected oil prices. About it Bloomberg reported three unnamed official on condition of anonymity.

The monthly volume of interventions at current oil prices is likely to be around $1 billion, said the interlocutors of the Agency.

According to them, under the new mechanism, the Central Bank will buy dollars in the market in volume, roughly equivalent to the additional revenues from the excess of actual oil prices to $40 per barrel, budgeted in 2017 for the Urals. The mechanism is designed to protect the exchange rate from the fluctuations in oil prices, according to the interlocutors of the Agency.

According to the Finance Ministry, additional revenues at an average price of
of oil at $50 per barrel will be about 1 trillion rubles, which is equivalent to
approximately $17 billion at the current exchange rate. One of the sources of Bloomberg said that the details of the plan are still under discussion and the actual purchase may be somewhat less than this amount.

“Such measures show that the government and the Central Bank join forces to accomplish common tasks to achieve an acceptable level of inflation”, — said the Agency strategist at Rabobank currency
developing countries Peter Matis.

According to officials, the Finance Ministry may announce details of the transitional rules budget this week. The final decision on the timing and volume of purchases will be taken by the Central Bank.

The press service of the Central Bank and Finance Ministry did not respond to requests by Bloomberg for comment.

In 2016, the ruble, collapsed in 2014-2015, strengthened against the dollar
approximately 20%, which allowed him to become one of the growth leaders among the currencies of developing countries, which adversely affects the competitiveness of Russian exporters, says Bloomberg.

Last week, the ruble briefly weakened after the statement of the first Deputy Prime Minister Igor Shuvalov about a possible early buying of currency by the Central Bank. “Obviously, with today’s oil prices and the decision netrate additional oil and gas revenues, we can confidently talk about the possibility of buying currency in the market”, — said Shuvalov.

On 20 January the Minister of economic development and trade Ministry Maxim Oreshkin said that the ruble will remain floating, and a “begin game currency” the Central Bank does not intend to.