RUSSIAN CENTRA BANK’S NABIULLINA: WE SHOULD BE ABLE TO LOWER THE KEY RATE FASTER
We should be able to lower the key rate faster.
We should create conditions for loans to be more affordable for the economy.
Monetary policy toughening in 2021, diversification of fx reserves helped economy to stay resilient amid sanctions.
Russian banks reduced share of assets denominated in foreign currencies to 19% as of beginning of 2022 vs. 35% in 2016.
Russian economy is entering difficult period of structural changes related to sanctions.
Main problems for economy will be related to restrictions on imports and logistics in trade, export restrictions.
Central bank monetary policy will aim at bringing inflation to 4% target in 2024.
Central bank considering making sale of forex proceeds by exporters more flexible.
Decision to suspend markets was necessary, otherwise exit of foreigners would have caused volatility and triggered mass bankruptcies.
The bank manually managed the markets to limit volatility and cool emotions of market participants.
Market reacted to the new situation much more softly than expected.
Russians withdrew 2.4 trillion roubles from banks in late February – early March.
Central bank plans to launch a programme to stimulate the import of equipment and raw materials which Russia cannot source itself.