Nabiullina said whether the presidential elections will affect the ruble exchange rate

“There are no artificial supports for the national currency now”

The ruble exchange rate is influenced by only two factors – the monetary policy of the Bank of Russia (that is, the level of the key rate) and the trade balance of our country. Chairman of the Central Bank of the Russian Federation Elvira Nabiullina announced this on Friday, February 16, answering a question from MK during a press conference following a meeting of the regulator’s Board of Directors.

In social networks and, in general, in the mass consciousness, a belief has formed that the ruble exchange rate before the presidential elections will be at approximately the same level: judging by data from the Moscow Exchange, somewhere in the corridor of 90-92 rubles per dollar. But immediately after this event, the authorities will stop taking any measures to stabilize it, and only then will it sharply begin to fall in price against the dollar and euro. As a result, Russians may again see a dollar worth 100 rubles, as happened a couple of times in 2023. In this regard, MK asked Elvira Nabiullina what forecast the Bank of Russia has for the value of the national currency at the end of March and whether the regulator itself will cancel or introduce currency restrictions after the election of the head of state.

“We have a floating exchange rate and we do not make forecasts on the exchange rate,” the chairman of the Central Bank of the Russian Federation emphasized in response to this question. — The exchange rate of the ruble to foreign currencies is influenced by fundamental factors. There are no special, artificial reasons for this. The main thing is the impact of our monetary policy and the state of the trade balance.” The head of the Central Bank of the Russian Federation emphasized that only these factors affect the value of the ruble against the dollar.

She added that perhaps the belief formed in the mass consciousness that the ruble exchange rate is now artificial is inspired by the opinion that the mandatory sale of foreign currency earnings (introduced by the government last fall) became a decisive factor in the strengthening of the ruble, and if it is abolished, then the national currency exchange rate will weaken. “Our analysis shows that the main factors that influenced the ruble exchange rate were an improvement in the trade balance and our tightening of monetary policy (that is, an increase in the key rate – editor’s note),” Nabiullina said. — This is what caused the strengthening of the ruble exchange rate. Even if we look at the mandatory sale of foreign currency earnings, the ratio of the sale of foreign currency earnings to the earnings itself was high in November – 94%, in December – 98%, this is higher than in the summer months. But this is a seasonal increase: exporters usually sell proceeds to pay dividends. And revenue sales were at the level of 2022-2023, so the main thing is fundamental factors.”

The strengthening of the exchange rate coincided with the impact on it of the increase in the key rate by the Bank of Russia (which lasted from July until the end of 2023) and the rebound in oil prices in August-September, and the receipt of foreign exchange earnings by exporters comes with a lag of an increase in the cost of oil by 1.5-2 month. “There are no artificial supports now, and there is no reason to expect that these supports will now go away and something will happen to the exchange rate,” the chairman of the Central Bank of the Russian Federation summed up her answer.

At the same time, the ruble reacted weakly to the regulator’s decision to leave the key rate unchanged at 16% for the first time in seven months of constant tightening of monetary policy. After the publication of the regulator’s press release, the dollar exchange rate decreased by 10 kopecks, to 92.53 rubles, and it ended the trading day on the Moscow Exchange at 92.22 rubles, while the euro stopped at 99.17 rubles, and the yuan stood at 12.65 rubles.