the Bank of Russia will continue a course on decrease in the key rate, the subject having considered the matter at the next meeting of the Board of Directors on April 24, said the head of the Central Bank Elvira Nabiullina. And that’s good news. Now there is almost no doubt that the regulator won’t return to its previous practice, the “anti-crisis” measures to tighten monetary policy to which it is actively used, including in crisis 2014.
In early April, Nabiullina hinted that the Central Bank will lower the rate below the current level of 6% if annual inflation reaches the target of 4%. “We will choose the right moment when we can this potential to start to use it,” she said.
Now, judging by her last statement, the situation allows: in the period 7 to 13 April, consumer prices rose just 0.2%, below the rate of growth in the previous three weeks. Annual inflation in March of 2.9%, but up to 4%, judging by the pace of growth is still far. Proefssional momentum caused by the weakening of the ruble and short speculative surge in consumer demand, quickly began to fade, according to official data.
Obviously, in a situation when the economy is paralyzed by quarantine measures of any suitable tools to stimulate business activity. One of the most obvious is the lowering of the key rate. Of course, against the background of what is happening in other countries where authorities have business enormous monetary support, the Central Bank must act decisively, says a senior analyst “BKS the Prime Minister” Sergey Suverov. Moreover, inflation is low, and in the medium term it may be further reduced, mainly due to the economic recession and rising unemployment. In addition, says Suverov, as budget revenues decline, the state likely will have to increase borrowing, and then the lowest rate will be very helpful.
“logically, the Central Bank will lower rates, and significantly, says investment Manager at “OTKRITIE Broker” Timur Nigmatullin. Yes, the ruble has weakened, but inflation is almost not affected – due to quarantine measures, the fall in consumer activity. The demand for goods and services has fallen so much that retailers, the sellers lost the opportunity to raise prices”.
Products in March hardly risen in the midst of consumer panic even buckwheat added to the price of only 6%, many other grains, and is cheaper. Year-end inflation may not exceed 2%, says Nigmatullin. According to him, in General, it is good for the economy: all those sacrifices that we were going in 2014, conducting aggressive inflation targeting, will now pay off. For the first time in the newest Russian history we can not to raise rates in a crisis, andnegati.
“because of the mode of isolation, the decline of the domestic economy and particularly the services sector appears to be inevitable, – said the head of IAC “Alpari” Alexander Razuvaev. – At the next meeting of the Bank of Russia is likely to lower its key interest rate by five percentage points to 5.5%. To some extent it will support the business. Unfortunately, the effects of monetary policy on macroeconomic indicators, the ruble is now limited. The decisive factor remains the price of oil”.
meanwhile, during a Friday press conference, the head of the Central Bank was a question on a topic that regularly raise today is not only journalists: “Why not to give in support of 10-20 thousand rubles, people with low incomes?” In it Elvira Nabiullina noticed that it is not to be confused with social benefits and helicopter money (direct transfers to households): the first, of course, necessary, and second, in its opinion, irrelevant as a tool of monetary policy. Earlier the idea of giving to all Russians for 15-20 thousand rubles was supported by the co-founder of the network DNS Dmitry Alekseev. In his opinion, in the current situation, to support more in need of ordinary citizens, not a business.
According to Alexander Razuvaeva, he is not a supporter of such approach: the state should create all conditions for self making money. However, to maintain retirees a one-time payment would be logical. In Russia about 40 million pensioners, and if I was to have $1 thousand, the cost will be $40 billion While the country’s international reserves equal $564 billion, of which 80% are liquid assets. From the point of view of Timur Nigmatullina, the question generally was not at the address, since the Central Bank is a separate branch of government, no relation to the government he does not have. Social benefits – the diocese of the Cabinet of Ministers.
Touching upon, among other things, restructuring of loans, Nabiullina said that by 15 April borrowers from among individuals filed more than 585 thousand cases of restructuring. Compared with the results of the last monitoring of the Central Bank, the share of satisfied bids increased from 14% to 44%. As for entrepreneurs, they submitted to the banks a little less than 60 thousand applications, of which was approved by 22.5 thousand, and almost 28 thousand considered.
