The recent depreciation of the ruble has run its course, Russian presidential adviser Maksim Oreshkin has told Interfax on the sidelines of the Eastern Economic Forum (EEF) in Vladivostok. The official added that a surplus of foreign currency is likely to materialize in the local market over the next few months.
The Russian currency has been testing multi-month lows against the dollar and the euro but rebounded last month after the central bank stepped in.
“Larger amounts of forex revenue from higher prices for export commodities will come onto the market in the next few months, which, given the declining amounts of imports of goods and services, as well as the effects from the key rate increase and tightening of macroprudential policy, will generate a surplus of forex on the market,” Oreshkin explained, noting that the market has passed its peak values.
Despite the ruble’s slide, Oreshkin says he expects the currency to stabilize, as the central bank “has all the tools” to normalize the situation in the near future. The Bank of Russia has also said that the ruble’s depreciation poses no risks to Russia’s financial stability.
In August, the CBR hiked its key rate by 350 basis points to 12% at an extraordinary board meeting, citing rising inflation. Prior to this, the rate had remained unchanged for several consecutive meetings since last October. CBR Deputy Chairman Aleksey Zabotkin said at the time that changes in the trade balance were weakening the ruble.
Last week, Zabotkin warned that pro-inflationary risks remain considerable and that the regulator does not rule out another rate hike at its board meeting on September 15.
The ruble strengthened during Monday trading on the Moscow Exchange to 95 against the dollar and 102 versus the euro.
For more stories on economy & finance visit RT's business section