weakening ruble closes budget deficit

The exchange rate difference from the revaluation of foreign currency assets and gold of the National Welfare Fund (NWF) for the nine months of this year has already amounted to 2.33 trillion rubles – this is four times more than was withdrawn from the fund to finance the federal budget deficit during this period (561 billion rubles. ), follows from the statistics of the Ministry of Finance. In general, as previously reported (see Kommersant on October 10), the volume of the National Welfare Fund as of October 1 was 13.65 trillion rubles, or $140.1 billion in dollar equivalent. The size of the liquid part was equal to 7.14 trillion rubles, or $73.3 billion.

Most of all, during the revaluation, the National Welfare Fund “earned” from balances in accounts in foreign currency – 1.263 trillion. Now it is only yuan (280 billion as of October 1, 2023) and euro (4 billion). The revaluation of gold (508 tons in anonymized form) gave another 930 billion rubles. In addition, the revaluation of Ukraine’s Eurobonds (remember, we are talking about a loan of $3 billion in the form of government securities purchased by Russia back in December 2013) increased the nominal size of the National Welfare Fund by 81 billion rubles, corporate foreign currency bonds issued for the implementation of infrastructure projects – more by 56 billion rubles.

In 2023, the exchange rate difference was negative only in May, when the ruble strengthened somewhat (minus 120 billion rubles, see chart). All other months of the year, the revaluation of foreign currency assets and gold was positive for the National Welfare Fund. According to the Central Bank, in the first quarter the ruble exchange rate averaged 72.72 rubles/$, in the second – 80.97 rubles/$, in the third – already 94.07 rubles/$.

As for the 561 billion rubles spent from the National Welfare Fund over nine months to close the budget deficit (through the sale of part of the yuan and gold), then 307 billion rubles. of this amount came in the first quarter, when, due to generous advances of expenses and advanced government procurement, the “hole” in the state treasury was especially large. In subsequent months, as the budget balance improved, withdrawals to finance the deficit decreased. In June they amounted to 67 billion rubles, in July – 44.4 billion rubles, in August – only 8.3 billion rubles. In September, there were no longer any withdrawals from the National Welfare Fund for deficits. Let us recall that in January-September the size of the federal budget deficit amounted to 1.699 trillion rubles, or 1% of GDP. At the end of the year and especially in December, budget spending, however, will increase noticeably: the Ministry of Finance expects that the 2023 deficit will ultimately amount to 1.8% of GDP.

Vadim Visloguzov