Russia Letter – Moscow - Week beginning June 13
- St. Petersburg International Economic Forum
Russia will be hosting its annual St. Petersburg International Economic Forum (SPIEF) this week. Considered as one of the most important events in the country, the forum will be hosting many influential people this year.
European Commission President Jean-Claude Juncker, Presidents of Armenia, Azerbaijan, Kazakhstan, as well as top officials from global and Russian companies are expected to attend the forum.
Russian President Vladimir Putin will also be holding a speech during the event.
- Key rate decision
Last week’s most important announcement came from the Russian Central Bank in which it announced a cut in its key rate by half a percentage point to 10.5 percent on Friday.
The decision to cut the key rate, which is a first in nearly a year, signaled the markets that it would start easing its monetary policy for the recession-hit economy.
“We are now more confident in the steadiness of inflation slowdown and that it will reach the target of 4 percent by the end of 2017,” the Central Bank’s Governor Elvira Nabiullina said after the decision was announced.
Meanwhile, the country’s Ministry of Finance announced Russia’s budget deficit as of June 1 this year as 1.48 trillion rubles (nearly $22 billion).
According to the announcement, the country’s budget revenues were 4.6 trillion rubles while expenses stood at 6.1 trillion rubles.
In another announcement last week, the ministry said the foreign trade turnover during the first four months of 2016 decreased by 48 percent to $33.2 billion compared to a year earlier.
Finally, another vital figure, Russia’s capital outflow for the first five months decreased from $54 billion in 2015 to $12.7 billion this year.
According to the country’s Central Bank, a total capital outflow of $40 billion is expected to be realized.