Performance of the Central Bank of Russia

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Performance of the Central Bank of Russia

Сообщение HainanWel.com(e)! » 11 июн 2016, 13:20

1. (inflation) decreased by 50 bp key rate after its nearly 11-mesyanogo plateau at 11% (the last time rates as the Central Bank changed on July 31 last year), the Bank of Russia through the mouth of its leader expressed confidence in the movement of inflation to the target level of 4% by the end of 2017. The behavior of the consumer price index yoy (annual inflation) actually turned out to be more optimistic than previously predicted regulator. Last 3 months (March-May), it remains at the same level (7.2-7.3%). Earlier it was expected that in the second quarter may rise due to the base effect - low inflation in the 2nd quarter of last year.

The gap is almost 4 n. Points to the key rate began to look unjustified. Despite the fact that some obvious reasons for the acceleration of inflation in the short (one-year) term is not in sight, and the expected real key rate (ex-ante), therefore, provided at a level far exceeding its historical, close to the 0 level in Russia. In the 1st quarter, when the price of oil fell to the lowest levels of long-term, inflation showed low sensitivity to exchange rate fluctuations (in particular, due to the halving of consumer imports). Moreover, this time the Bank of Russia further demotivate "flight into the currency", while increasing reserve requirements on foreign currency deposits (which should result in lower interest rates attract foreign currency deposits from customers).

However, if you look not on an annual and on a "current" monthly inflation, the movement to the level of 4% still looks rather a wish than "pulling" the already existing trend. The pace of price growth in April and May were about the same as a year ago, and evolved almost in the same conditions - the ruble under the influence of rising oil prices. Save the current inflation allows only stabilize its annual figures in 2017. at about 6.8%. However, the Central Bank still expects to double the lower indexation of utility tariffs from 1 July than a year ago, as well as a positive impact relatively low fuel prices for production and transport costs, and the expected good harvest of vegetables and fruits. Perhaps all this inflation may slow to 1 point more. Item, or a little more.

2. (Credit and consumer demand), the Bank of Russia explained some easing of monetary conditions and the continued low demand for credit and sluggish, even in relation to the income of the population, consumer demand. However, with the new year, the credit indebtedness of the population has ceased to contract in the denomination. But adjusted for inflation, the population is still less attracted credits than returns and the level of savings income remains elevated.

in the first months of this year, shopping population in retail trade continued to shrink at about the same high rates that have been established in the second half of last year. Their level fell by about 13% to an average of 2014 indices. (Excluding consumer panic of that year). All this makes the gain and the risks of inflation due to the decrease occurred insignificant rates. Nevertheless, the Bank of Russia decided to abolish the anti-crisis regulatory relief measures previously introduced in respect of unsecured consumer loans, so that they continue to remain expensive.

3. (natural softening of the DCT and liquidity surplus) The expenditure of federal budget funds leads to a reduction in banks' demand for central refinancing, and basically makes the Central Bank of liquidity provider in the net borrower. This allows banks to reduce interest rates on deposits, and then - to mitigate credit conditions even when the key rate unchanged.

Central Bank expected the transition to the liquidity surplus in the second half of this year. However, due to the positive changes in the Russian budget situation (rising oil prices at relatively stable exchange rate of the ruble) costs of federal funds should be reduced. So until early next year, probably still will remain a lack of liquidity, although much smaller than a year ago. This means that the "workers" remain either border corridor Central Bank rates, interbank rates will lie within the corridor, not gravitate to the bottom ( "absorption") border, as it would be at a structural surplus of liquidity.

4. (Production and business activity) of the Central Bank has improved the forecast release, based on the fact that the decline in GDP in the first quarter was lower than expected, despite the unfavorable situation on the oil. Now, in the baseline scenario ($ 40. Per barrel.), It is expected that in the second half of the quarterly GDP growth rate will be replaced by a plus sign on (and, therefore, a 2-year recession ends). And in 2017. GDP growth is possible, and for the whole year (by 1.3%). With these parameters, the current president of the "surrender" of Russia's economy in 2018. (Probably at the same place) in about the same state stability issue that took (GDP decline for 6 years is not statistically significant from 0.5 to 1%).

Preserving the level of GDP, which is 2/3 of the sum of the non-tradable sectors (trade, banking, logistics, etc.) is largely dependent on imports sizes. Central Bank expects that it will be kept low by historical standards, the net capital outflow (25-30 bln. USD. Per year.), And falling demand for foreign assets due to constricted oil revenues, as well as the conservation of the differential yields of ruble and foreign currency assets in favor of the former.

The Bank of Russia also considered the possibility of a repetition of falling oil prices. The risk scenario with the oil price of 25 US dollars per barrel, inflation at the end of 2016. exceed 6.5%, and GDP will decrease by 1%. But the likelihood of such a scenario, according to the regulator, low. Nevertheless, taking into account the existing risks, the regulator has promised to pursue a balanced monetary policy, and called on all the participants of the economy and to maintain "healthy conservatism."
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