-Russian Central Bank signals rate hike
The Central Bank of Russia assessed inflation risks including the possibility of further U.S. sanctions and a partial decline in oil prices.
Russia's Central Bank President Elvira Nabiullina said in his speech at the lower house of the Russian parliament last week that they are seriously considering an increase in the policy rate.
Nabiullina noted that “outside” pressures on the Russian economy significantly increased and he said that, “Our duty as the Central Bank is to prevent this pressure from keeping the economic development in Russia behind.“
With this strategy in mind, he advocated for an interest rate increase now to contain “the risk of a serious interest rate increase in the future.”
In February and March this year, the Russian Central Bank cut interest rates twice. However, due to increased inflation risks and new U.S. sanctions, the bank increased its interest rate to 7.5 percent in September.
Deputy Finance Minister Sergey Storchak reacted to reports of the U.S. Treasury Department’s imposition of sanctions this month to ban Russian government debt transactions and to restrict the largest Russian banks using U.S. dollars.
His statement on these potential U.S. sanctions struck a positive tone.
Assessing the U.S.' plans, Storchak said, “We can close the federal budget deficit caused by the sanctions with our reserves. We are not in a panic.”
In response to the positive statements from Europe, Storchak said that Europeans are ready to trade in national currencies such as the Euro.
-Russia's foreign trade surplus reaches $150 billion
Russia's foreign trade surplus increased by 63 percent in the first nine months of this year to $150 billion compared to the same period of 2017.
According to data from the Russian Federal Customs Service (FTS), the country's exports increased by 27.8 percent to $327 billion in January-September this year compared to the same period of 2017, while imports increased by 8 percent to $177 billion.
Russia's total trade volume rose by 20.1 percent to $504 billion in the January-September period compared to 2017.
In the first nine months of the year, Turkey was Russia's 5th largest trade partner, with a trading volume reaching $19.4 billion, an increase of 25.9 percent.