ARCHIVE. Last updated: 27.03.2020. Up-to-date information is available on the Bank of Russia website (current version).

Situation in financial markets and stabilisation measures

Amid the increased volatility, the Bank of Russia is closely monitoring the developments in the financial market.

Today, the Russian financial system is better prepared for external shocks than in 2014–2015. The banking sector, as well as the financial system in general, have accumulated capital and liquidity buffers, both in rubles and in the foreign currency. The amount of external and domestic foreign currency-denominated debt has decreased in the recent years. The fiscal rule largely protects the budget from oil price swings.

The weakening of the ruble, caused by changes in external conditions (the coronavirus epidemic spread and the worsening situation in the oil market), is a significant but short-term proinflationary factor. Inflation will return to the Bank of Russia’s target from the low levels of the recent months faster than previously forecast.

However, the pronounced and prolonged slowdown in the global economy, the increased uncertainty, the observed tightening of monetary conditions, and their impact on domestic demand may become material disinflationary factors over the medium-term horizon.

The Bank of Russia will comprehensively consider the effect of the recent changes on the medium-term forecast of inflation, inflation expectations and economic developments and assess the risks of sustainable deviation of inflation from the target over the forecast horizon.

Information and analytical commentary “Consumer price dynamics”, February 2020

The Bank of Russia has taken a number of measures to stabilise the situation and mitigate the negative impact on the financial system and the economy:

On 20 March 2020, the Bank of Russia Board of Directors decided to keep the key rate at 6.00% per annum. For details, see...

Statement by Bank of Russia Governor Elvira Nabiullina in follow-up to Board of Directors meeting 20 March 2020

On 13 March 2020, the Bank of Russia has decided to hold a fine-tuning repo auction in the amount of 500 billion rubles, given the fluctuations of exchange rates and financial asset prices in Russian and global financial markets as well as the actions taken by central banks of other countries over the course of this week. For details, see ...

The Bank of Russia Board of Directors took a decision not to apply from 1 March 2020 to 30 September 2020 add-ons to risk weights to foreign currency-denominated loans issued during that period to manufacturers of pharmaceuticals, medical products and equipment, as well as to investment in foreign currency-denominated debt securities of such organisations made during the above-mentioned period.

On 10 March 2020, the regulator decided to start pre-emptive foreign currency sales in the domestic market under the fiscal rule, taking into account the current oil price and its impact on the operations of the National Wealth Fund (NWF) in April. For details, see ...

As part of the operations to provide liquidity for the banking sector, we have held a repo auction in the amount of 500 billion rubles and increased the limit on FX swaps. The Bank of Russia will continue to monitor the situation to adjust the amount of operations. For details, see ...

In addition, due to the increased volatility in the FX and securities markets, the regulator has introduced temporary (until 30 September 2020) regulatory easing for banks. These measures are intended to help the transport and tourism sectors overcome the difficult period and to stimulate lending to producers of medical goods, the demand for which has recently increased. For details, see ...

Comments by Ksenia Yudaeva, First Deputy Governor of the Bank of Russia, for the Russia 24 TV channel on 10 March 2020

On 9 March 2020, the Bank of Russia decided not to purchase foreign currency in the domestic market under the fiscal rule over the course of the next 30 days. For details, see ...

The Bank of Russia has sufficient instruments to support financial stability and is prepared to promptly use them if the situation so requires.

This page may be updated if new information is received.

20 March 2020

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