Armed by the foreign exchange rate, CBR CEO Sergei Ignatiev stepped down on the warpath against ruble profiteers.
Photo: Dmitry Azarov
| Other Photos |
 |
|
 |
CBR Confirmed Fx Limits
Chief of the Central Bank of Russia (CBR) acknowledged yesterday the existence of foreign exchange corridor, within the limits of which CBR maintains the rate of Russia’s ruble to U.S. dollar and euro. The ruble fluctuations, Ignatiev made clear, are targeted at scaring away the profiteers that apply carry-trade methods and at preparing the market towards floating exchange rate of the ruble and new policy of inflation control.
CBR CEO Sergei Ignatiev made a program statement yesterday, clarifying the market behavior of the bank in April to May and the CBR strategy in part of domestic foreign exchange interventions that had been announced a fortnight ago.
“We intend to gradually, even very gradually, widen the limits of technical control corridor for the worth of bi-currency market. By doing so, we will be gradually, even very gradually, approaching the free float of ruble exchange rate, which will enable us to near inflation targeting,” Ignatiev announced yesterday at the opening of the Bank Congress in Moscow.
The statement of Ignatiev is the first official confirmation that the CBR chief provided for existence of the currency band, within which the ruble rate may change to bi-currency basket ($0.55 + €0.45). Given the recent movement of ruble, its range is roughly 1 percent, or 30 kopecks. Whenever the ruble nears the limits, CBR steps in either with the foreign exchange or ruble interventions.
The extension limits of the corridor are yet unclear. It will probably be 5 kopecks this year, Oleg Viyugin forecasted yesterday. Employed with MDM bank today, Viyugin was once deputy to the CBR CEO.
www.kommersant.com
All the Article in Russian as of May 30, 2008
|
|
|
