Russian Ministry of Finance Will Significantly Increase the Volume of Currency Purchases in October
OREANDA-NEWS The Ministry of Finance of Russia from October, 5 to November, 7 will receive on the purchase of foreign currency on the domestic market 475,7 billion rubles, is spoken in the message of the Ministry of Finance.
"The total amount of funds allocated for the purchase of foreign currency is 475.7 billion rubles. Operations will be carried out in the period from October 5, 2018 to November 7, 2018, respectively, the daily volume of foreign currency purchases will be equivalent to 20.7 billion rubles," the Ministry said.
Additional revenues from oil in October are expected at the level of 479.7 billion rubles.
In late August, the Central Bank due to volatility in the market and a sharp weakening of the ruble due to sanctions of the USA declared the termination of purchases of foreign currency for the Ministry of Finance in the budgetary rules until the end of 2018. Instead of operations in the domestic market, the currency will be directly purchased by the Treasury from the Central Bank.
At the same time, the Central Bank promised not to buy currency for the Ministry of Finance on the exchange this year, even with the strengthening of the ruble.
The Ministry of Finance began to buy foreign currency on the domestic market under the budget rule in February 2017 to stabilize the ruble and reduce the dependence of the Russian economy on oil prices. According to this mechanism, additional revenues from higher than budgeted oil prices (above $40 per barrel) are allocated for the purchase of foreign currency. For reserves, dollars, euros and pounds are purchased.
After this news, the ruble began to fall in price. Other reports from Russian government agencies and statements of officials could contribute to the weakening of the ruble, said analyst "Veles Capital" Yuri Kravchenko.
In particular, the government said that they are working to reduce the dependence of the Russian economy on the US currency. In addition, the head of the Ministry of economic development Maxim Oreshkin said that the ruble is returning to its fundamental levels. According to the expert "Veles Capital", investors could interpret this statement as a signal to end the strengthening of the ruble.