Central Bank of Russia
View:
April 26, 2024 1:12 PM UTC
Bottom Line: As widely expected, Central Bank of Russia (CBR) announced on April 26 that it decided to keep the policy rate unchanged at 16% for the third meeting in a row. CBR made critical changes in its key rate and inflation forecasts as it lifted its 2024 inflation forecast to 4.3-4.8% from 4-4
March 25, 2024 2:00 PM UTC
· Unlike South Africa and Russia, Turkiye continued with tightening monetary policy in Q1 due to stubborn inflation, pressure on FX and reserves. Meanwhile, Russia and South Africa halted their tightening cycles as of 2024 and will likely start cutting interest rates in Q3 depending on how
March 22, 2024 10:55 AM UTC
Bottom Line: As we envisaged, Central Bank of Russia (CBR) announced on March 22 that it decided to keep the policy rate unchanged at 16% for the second meeting in a row, despite inflationary pressures remaining elevated, and currency weakening continued. We expect the CBR to hold the key rate stab
February 16, 2024 1:49 PM UTC
Bottom Line: As we predicted, Central Bank of Russia (CBR) announced on February 16 that it decided to keep the policy rate unchanged at 16% after lifting the rate in the last five consecutive MPC meetings, despite inflationary pressures and expectations remaining elevated, domestic demand still out
December 18, 2023 10:01 AM UTC
Our Forecasts
Source: Continuum Economics
Risks to Our Views
Source: Continuum Economics
EMEA Dynamics: Inflationary Concerns Remain High
EMEA economies continue to be squeezed by macroeconomic problems such as elevated inflation and financial pressures. We think country specific factors, geopolitics,
December 15, 2023 3:47 PM UTC
Figure 1: Policy Rate (%) and CPI (YoY, % Change), December 2021 – December 2023
Source: Datastream, Continuum Economics
In order to reduce inflation and inflation expectations, and to anchor inflation at the target level, CBR continued its tightening cycle in the fifth consecutive MPC meeting, and
December 8, 2023 7:47 PM UTC
Figure 1: Inflation Rate (%, YoY), November 2022 - November 2023
Source: Datastream, Continuum Economics
According to Rosstat on December 8, prices of food, non-food products and services rose by 1.55%, 0.53% and 1.23% on a monthly basis in November, respectively. The consumer price index (CPI) edged
November 29, 2023 7:11 PM UTC
Figure 1: Industrial Production (%, YoY), October 2020 – October 2023
Source: Datastream, Continuum Economics
The Russian economy continues to grow fast in 2023 so far, after partly relieved from the negative impacts of the war in Ukraine in 2023. The Russian economy grew by a strong 5% YoY in Octob
November 15, 2023 5:25 PM UTC
Figure 1: GDP Growth (%, YoY), Q3 2020 – Q3 2023
Source: Datastream, Continuum Economics
The Russian economy continues to grow fast in 2023 so far, after partly relieved from the negative impacts of the war in Ukraine. (Note: Russian GDP decreased by 1.8% in Q1 2023, and grew by 4.9% in Q2.) The mai
November 10, 2023 5:06 PM UTC
Figure 1: $/RUB Rate, November 2021 - November 2023
Source: Datastream, Continuum Economics
According to Rosstat, prices of food, non-food products and services rose by 1.35%, 0.55% and 0.48% on a monthly basis in October, respectively. The consumer price index (CPI) also rose by 0.83% on a monthly b
November 9, 2023 12:02 PM UTC
Figure 1: Russia GDP Growth Forecasts to 2030 (%)
Source: Continuum Economics/Datastream
Figure 2: Russia Population Forecasts to 2030 (Thousand)
Source: Continuum Economics/Datastream
Figure 3: Russia Industrial Production Forecast to 2030
Source: Continuum Economics/Datastream
Technology is also o
November 1, 2023 2:23 PM UTC
Figure 1: Industrial Production (%, YoY), October 2018 – September 2023
Source: Datastream, Continuum Economics
The main accelerator for Russian growth continues to be the surge in the military spending after the war in Ukraine started. Despite there being a pause on territorial advance by Russia o
October 12, 2023 6:05 PM UTC
Figure 1: CPI Inflation Rate (%, YoY), September 2022- September 2023
Source: Datastream, Continuum Economics
According to Rosstat, prices of food, non-food products and services rose by 0.86%, 1.09% and 0.61% on a monthly basis in September, respectively. The consumer price index (CPI) also hiked by
October 3, 2023 7:50 AM UTC
Figure 1: $ to Ruble Rate, September 2022- September 2023
Source: Datastream, Continuum Economics
After food prices rose by 3.6% in annual terms, the cost of services surged by 9.5% in annual terms and yearly diesel fuel prices hiked by 4.1% in August, we expect rising patterns to continue in Septembe
September 28, 2023 7:45 AM UTC
EMEA Dynamics: Domestic Factors and Geopolitics Continue to Dominate the Outlook during 2024 Election Year
EMEA economies continue to be squeezed by the elevated DM interest rates, high oil and certain food prices, EU and China slowdown. However, country specific factors and geopolitics will continue
September 27, 2023 3:54 PM UTC
Figure 1: Central Government Deficit/Surplus (in Trillion Rubles), September 2020 - August 2023
Source: Datastream, Continuum Economics
The predictions for Russian GDP remain positive, despite the ongoing Ukraine war and macroeconomic problems. Underlining strong manufacturing figures, economic devel
September 15, 2023 2:13 PM UTC
Figure 1: $/Ruble, September 2020 - September 2023
Source: Datastream
Despite general consensus among economists forecasting no change in the key rate on September 15, CBR surprised the analysts. (Note: Our prediction was a hike by 50 bps to 12.5%). As specified by the Monetary Policy press release by
September 11, 2023 8:10 AM UTC
Figure 1: CPI (%, YoY), January 2021 - August 2023
Source: Datastream, Continuum Economics
According to Rosstat, food prices rose by 3.58% in annual terms, while prices of non-food products soared by 1.14% on a monthly basis and by 3.5% compared to August 2022. The cost of services surged by 9.54% in
September 1, 2023 10:03 AM UTC
Figure 1: GDP (%, YoY), Q3 2018 – Q2 2023
Source: Datastream, Continuum Economics
The predictions for Russian GDP remain positive despite the ongoing Ukraine war. Russian Finance Minister Anton Siluanov said on August 26 that Russia's economy is expected to grow by 2.5% or more in 2023. Central Ban
August 15, 2023 3:08 PM UTC
Figure 1: CPI (%, YoY), January 2021 - July 2023
Source: CBR, Rosstat
As high domestic demand and lending, strong military spending (which is estimated to be more than $100bn in 2023, a third of all public expenditure)in addition to aggravation of staff shortages fanned inflation this year, CBR’s de
August 14, 2023 2:00 PM UTC
Figure 1: GDP (% YoY), Q3 2018 – Q2 2023
Source: Datastream, Continuum Economics
Supported by the recent GDP release, the predictions for Russian GDP remain positive. In its report on the outlook for the world economy, IMF raised its forecast for Russia's GDP growth in 2023 by 0.8 percentage points
August 10, 2023 7:09 AM UTC
Figure 1: CPI and PPI (2010=100), August 2018 - July 2023
Source: Datastream, Continuum Economics
According to Rosstat, food prices in July rose by 0.49% compared to June and by 2.23% in annual terms, while prices of non-food products soared by 0.91% on a monthly basis and by 2.36% compared to June 20
August 1, 2023 3:19 PM UTC
Figure 1: Inflation, Inflation Expectations and Key Rate
Source: CBR, Rosstat
As specified by the Monetary Policy Report published on July 31, and as CBR governor Nabiullina stated in follow-up to the recent Board of Directors meeting, CBR started monetary tightening as of July since the ruble has
July 21, 2023 1:15 PM UTC
We think the inflationary pressures were the main driver for the rate decision. First, as the benefits from base effects bringing inflation down has ended in April, Russian inflation continued its increasing pattern in June, picking up 3.25% when compared 2.5% the previous month. In addition, the Mi
July 18, 2023 8:47 AM UTC
First, let’s elaborate on why Russian economy continues to struggle, particularly after May. Russian inflation entered an increasing trend as of June and reached 3.25% Yr/Yr (from 2.5% a month earlier), following a short easing cycle in March and April, as the base effects brought inflation down h
June 21, 2023 8:03 AM UTC
EMEA Dynamics: Deteriorating Macro Picture Cannot Steal the Stage from Politics and Geopolitics
EMEA economies continue to be squeezed by elevated DM interest rates as the growth trajectories decrease for most countries for 2023. Soaring DM interest rates have different effects across the three key c
September 9, 2022 1:01 AM UTC
Figure 1: USD Rises More Slowly against Key EMs and Falls vs. Brazilian Real (Dec. 31, 2021 = 100)
Source: Continuum Economics
The USD surge against G10 currencies has not been replicated so far against bigger EM currencies for a number of reasons. Key points include:
Figure 2: 10yr Nominal Yield Spre
June 30, 2022 9:30 AM UTC
Figure 1: Russia Gross External Debt — Foreign Currency Bonds, $m
Source: Bloomberg, Continuum Economics
Default was a foregone conclusion since the U.S. Treasury failed to renew the waiver for Russian debt payments on May 25, but it is now official: Russia's failure to pay interest on a pair of Eur