Econ min says Russia’s budget rule cuts ruble’s dependency on oil

MOSCOW, Oct 16 (PRIME) -- Russia’s budget rule is working to reduce the ruble’s dependency on oil prices, while the current market volatility reflects the situation at the global market, Economic Development Minister Maxim Oreshkin told reporters on Tuesday.

“What is the reason for our market’s volatility? It is not in any way connected to the government’s purchases or to operations of the central bank. It is connected to general volatility of the global market. If you look at the volatility of the Russian ruble over the past two years, it will be lower than volatility of almost any emerging currency. But for the budget rule, the ruble would have moved rapidly in line with oil,” he said.

Under the budget rule, the government allocates excessive oil and gas revenues to reserves. The government fulfills the rule 100%, and the Finance Ministry and the government have not stopped purchases of foreign currency, he said.

“When the central bank announced a floating rate, it left the possibility of hold foreign currency interventions in order to ensure financial stability. And the central bank is actually holding foreign currency interventions at the currency market, it sells currency to ensure financial stability,” he said.

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