On 14 September, the Bank of Russia took two important decisions: increased the key rate by 0.25 percentage points to 7.5% and also extended the suspension of foreign currency purchases on the domestic market by implementing the fiscal control mechanism by the end of December . Elvira Nabiullina, the head of the Central Bank of the Russian Federation, explained the regulator's decision to limit the heightened inflation risk and to reduce the impact of changed external conditions on price and financial stability.
A survey of analysts on the eve of the CB meeting showed that the market expected the base interest rate to remain at the same level. Experts were of the opinion that, despite the increase in the volatility of the ruble against the background of the introduction of new US sanctions in April and August, the inflation risks are not yet so great that the regulator interrupted the cycle of tariff cut by to raise the figure, but this happened – for the first time since December 2014, takes note of it "Interfax".
Ruble weakening in August and
Increasing VAT from 2019 will lead to an increase in inflation expectations and
uncertainty in their dynamics in the future, said the head of the Bank of Russia
Elvira Nabiullina at a press conference following the results of the Executive Board of the Central Bank.
"Inflationary expectations of the population have increased and remained in May
summer months at this elevated level, and the company continued to grow, "- commented
it has the effect of weakening the ruble on inflation expectations.
"At the end of the year, the reaction of inflation expectations on the
forthcoming VAT increase. Polls show that the expectations of the population
have not yet started to take this into account. At the same time, companies are already
their expectations of a decision to increase VAT along with exchange rate dynamics, "-
added the head of the Central Bank.
Moreover, the Central Bank does not exclude that this will further raise interest rates. "We will assess the feasibility of further raising the policy rate given the dynamics of inflation and the economy in relation to the forecast, as well as the risks of external conditions and the response of financial markets to them," Elvira said. Nabiullina during the briefing.
After examining the release of the Central Bank following the results of today's meeting, as well as the statements by the head of the regulator Elvira Nabiullina at the press conference, analysts pay attention to the more serious rhetoric of the Central Bank and do not exclude that the Bank of Russia will not limit itself to raising tariffs only in case of deteriorating external circumstances until the end of this year.
The indication of the subsequent dynamics of the price has become heavier, Vneshtorgbank & # 39; s economist for Russia and the CIS, Alexander Isakov, told Tass. In the wording he notes that instead of the usual designation, depending on the incoming macroeconomic statistics, the phrase about the expediency of further tariff increases is used: "The Bank of Russia will decide on the key rate, the inflation risk & # 39 ; s, to assess the inflation dynamics and the economic development in relation to the prognosis ".
It is quite logical that in the case of deterioration of the above parameters, a cycle of tightening of the monetary policy of the Central Bank of the Russian Federation may occur, says Dmitri Kharlampiev, Director of Analytics at KIB Bank Otkritie.
The chief economist for Russia and the CIS, Renaissance Capital, Oleg Kuzmin, expects a key rate of 8% in the first quarter of 2019, even if there are no new serious sanctions. "If the sanctions cause a higher capital outflow, the rate can vary from 8% to 15% by the end of 2019", says the expert.
The suspension of currency claims under the fiscal rule until the end of 2018 indicates a shift in the development of a united position of the country's economic bloc, which will have a positive effect on the ruble exchange rate, according to Anton Pokatovich, chief analyst of BCS Premier. "We can summarize that the Central Bank has maintained its independent position and has indicated the likelihood of a cycle of raising key interest rates in response to the intensification of the whole range of destabilizing factors, including: capital outflow from developing countries, US and EU sanction pressures, inflationary risks in the Russian economy and "etc.", he notes.
According to the chief economist of the Russian direct investment fund Dmitry Polevoy, in the absence of adverse market turmoil, the ruble could rise from the current levels in the coming months.
Now the exchange rate of the ruble depends more on geopolitics and the dynamics of currencies in developing countries, adds Roman Tkachuk, a senior analyst at Alpari. "Based on today's decision on the tariff and the press conference with Nabiullina, this is all right, this should calm down investors.If there are no new high-profile statements about sanctions against Russia, next week the ruble will continue to strengthen – the dollar will roll back to 67-67, 5 rubles and the euro will fall below the 79 rubles. "- The expert predicts.