The current fiscal situation poses no risks to macroeconomic stability, according to the president
The Russian government and the central bank should make more active use of all the tools they have to reduce financial market volatility, President Vladimir Putin said on Tuesday.
Speaking at a meeting of the Council for Strategic Development and National Projects, he pointed out that inflationary risks in Russia have been rising and that price growth is a top priority. The government and the central bank need to develop the corresponding economic policy, he stressed.
“In recent months, volatility in financial markets has increased significantly. We are all well aware of this. Obviously, such fluctuations make it difficult for businesses, enterprises, and citizens to make investment decisions … And here we need to work, among other things, on limiting unproductive, speculative demand in the economy, controlling capital outflow, monitoring the behavior of other financial market participants,” he stated.
The president went on to say, “Objective data show that inflationary risks are nevertheless growing. And the task of curbing price growth is now coming to the fore.”
Consumer inflation in Russia from the start of the year through August 14 was 3.52%, official statistics show. Last week, the Bank of Russia announced a major interest-rate hike, raising rates by 350 basis points to 12% at an emergency meeting, in a bid to halt the rapid depreciation of the ruble against world currencies.
According to Putin, Russia’s federal budget will be in a surplus for the third quarter while there will be a deficit of around 2% of GDP for the year, as planned. “The current fiscal situation is generally robust and poses no risks to macroeconomic stability,” he insisted.
The president also urged to maintain the dynamics of investment growth in the country, saying that in real terms they should grow by at least 70% by 2030 compared to 2020. He noted it is important to support companies in expansion, innovation, and job creation.
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