Why does the state need a weak ruble? Ten reasons why the Russian economy benefits from a weak ruble. What will the Ministry of Finance's foreign exchange purchases lead to?

The Russian currency is breaking historical records, the cost of goods and services is increasing, and from TV screens we are assured that the weakness of the ruble has its benefits. In this article we will look at: weak ruble- Is this good or bad?

A weak ruble is good

• Unstable currency unit countries can bring benefits when exporting any goods abroad. In this case, two more factors must be taken into account: a wide range of goods offered for export, and a slight increase in the price level. Almost the only valuable product that Russia exports to other countries is energy resources. When a national currency weakens, the price of oil declines, and the ruble makes up for the loss. In this case, hope is placed on import substitution. In addition to reduced competitiveness, other factors that may be hampered by government policies or tax collections must also be considered.
• An unstable currency brings benefits to the state budget and the government. When the price of oil decreases, the shortfall in the state budget is compensated by funds from the sale of gas and oil. On the other hand, it decreases and total income residents of the country, which negatively affects the overall economic image of Russia. In this case, replenishing the budget is perceived as an attempt to maintain stability.
• The Central Bank is directly involved in supporting the ruble, and this is not profitable for it. Otherwise, Central bank countries could easily increase the value of the dollar.

A weak ruble is bad

• If an organization takes out a loan in another country, it is done in dollars, and income from the sale of goods and services is calculated in Russian rubles. When it is necessary to repay a debt, the weakening of the ruble exchange rate carries with it an increase in the total amount of debt. This can be fraught with bankruptcy even for large enterprises.
• Almost half of the goods are brought to Russia for import - all products are paid for in dollars. When the national currency weakens, the solvency of the country's population also decreases. This fully illustrates the current increase in the price level within the country.
• Russia faced a complete depreciation of the ruble in the 90s. In stores, each product had a price in dollars. This indicated that the ruble had no value and was recognized as an ordinary piece of paper. In those days, the population of our country really faced the concept of a weak ruble.

The only option when an unstable national currency can be beneficial to the government of the country is the predominance of the share of exported goods over imported ones. At the same time, it is important to expand the range of exported goods. The increase in price levels must also be controlled - inflation should not exceed 3%. Otherwise, talk about the benefits of a weak ruble has no basis, because each of us can experience this from our own example.

Associate Professor at the Faculty of Finance and Banking at RANEPA Sergei Khestanov told why Russia does not need a strong ruble.

During the first half of the year, the fall of the ruble against the dollar exceeded 8%. At first glance, given current oil prices, this seems illogical. However, if we take into account sanctions and the budget rule, the behavior of the ruble is quite natural. The majority of Russians, of course, were not pleased with this dynamics, but exporters were happy, the budget deficit was replaced by a small surplus and replenished by a substantial amount.

Sanctions

US sanctions introduced in April will not take effect until October. However, many cautious investors began to withdraw their capital in advance. In the first quarter alone, they withdrew $17 billion (for the entire 2017 - $31.3 billion). As a result, the domestic currency came under pressure. The Central Bank estimates the impact of this negative factor at 4% in the overall depreciation of the ruble.

Investors may have rushed to sell Russian ones since Trump abruptly announced his withdrawal from the Iran nuclear deal in May. The anti-Iranian rhetoric of the United States practically excludes increased pressure on Russia. The Americans, having decided to tighten the screws on Iran, are jeopardizing oil market. Replace this country's oil through the work of American shale companies and supplies from Saudi Arabia extremely problematic, which is why the United States is interested in the uninterrupted supply of Russian oil to the world market. Consequently, Americans are unlikely to decide to take the path of real restrictions in relation to Russia.

Budget rule

Second important factor, which does not allow the ruble to strengthen, is large-scale purchases of American currency by the Ministry of Finance and the Central Bank. A barrel of Urals brand now costs much more than $40.8, and additional income The government uses the money received from the sale of oil to purchase foreign currency. As a result, the ruble does not strengthen due to expensive oil, but is replenished foreign exchange reserves countries. In the first 5 months, they increased by $24 billion, to $456 billion.

Feasibility of accumulation international reserves– the question is debatable. Many believe that it is better to invest profits from oil sales in the country's economy. However, the last two crises (2008 and 2014) showed that without a “safety cushion” a financial catastrophe could occur in Russia.

Economists also argue about the volume of necessary reserves, but so far the authorities have decided to reserve 7% of GDP for a rainy day. When the container is filled to this level, excess profits from the sale of oil will be directed to the implementation of government projects. At current oil prices, this could happen in 2020–2021.

Apparently, the budget rule will work in the country for a long time. Federal budget highly dependent on oil revenues: their share is about 30%. The situation can only be changed through structural restructuring of the economy, which will take at least 10-15 years.

In the absence of unforeseen circumstances, the ruble exchange rate in the next couple of months will fluctuate in the range of 62-64 rubles/dollar. Main source for the domestic currency - waiting for the results of the meeting between Putin and Trump.

From the meeting of the two presidents we can expect a detente between the Russian Federation and the United States. At the very least, the negotiations will take place in Helsinki, the city where the famous Helsinki Agreement was concluded in 1975. Then it was possible to smooth out the rough edges between the USA and the USSR. This is partly why the Soviet economy in 1975–1984. I felt good. In terms of the level of well-being of the population, this period was the best in the entire history of the USSR.

From about April the course Russian currency is constantly falling against both the dollar and the euro. Such a spectacular fall was achieved by the combination of two factors - and sanctions had nothing to do with it.

Firstly, almost all developing markets showed a fall in the exchange rates of national currencies in a period similar to the ruble. This was due to the fact that international investors began to flock to the dollar en masse. In addition to Russia, the currencies of Indonesia, Argentina, Brazil, India and, especially, Turkey weakened. Even the euro suffered as a result of fluctuations in world markets, but this currency is so powerful that the changes went almost unnoticed.

Secondly, there is now a serious change in the vector monetary policy in Russia. Previously, the Central Bank did not interfere in the market, and when the exchange rate fell sharply, it tried to stop this process by selling dollars from reserves. Now the Central Bank, on the contrary, is actively buying them in order to lower the ruble exchange rate. So the current situation with the ruble was created absolutely deliberately in order to increase the budget surplus. Putin's May decrees require money.

Photo: Sefa Karacan / Anadolu Agency / Getty Images

In themselves, these decrees simply help allocate funds between people close to the Kremlin. These people are putting pressure on the Ministry of Finance, demanding to show the sources of the money. And the budget surplus due to the low exchange rate of the ruble became one of these sources. In addition to this, the list includes an increase in taxes, expressed, in particular, in an increase in VAT, and a reduction social guarantees- in the form of raising the retirement age.

All this seems to last for a long time, because the stakes are on American market are growing, and the Federal Reserve balance sheet is being deliberately reduced by the Americans themselves. This means that the amount of money in the market will decrease and investors will get rid of falling currencies. As a result, this can last for months and even years.

Approximately the same time forecast can be given for new policy Central Bank on the deliberate weakening of the ruble. It would be more difficult to strengthen it, because this would require dollar reserves, which are limited, unlike the ruble. It can be printed endlessly.

There will be no return to fundamental positions (58-61 rubles per 1 dollar): this is simply not beneficial for anyone

There are no signs that the Ministry of Finance and the Central Bank intend to abandon this strategy in the long term, although in the short term the purchase of dollars has ceased. As a result, the market itself began to play against the Russian national currency: Many domestic investors who owned positions in rubles began to exit them. And this massive exit worked instead of the Central Bank and the Ministry of Finance, which eventually had to stop in order to prevent catastrophic consequences.

Now the fall, I repeat, has stopped. And, perhaps, somewhere on the sidelines of the two departments a decision will be made to buy some rubles in order to balance the situation. However, there will be no return to fundamental positions (58-61 rubles per 1 dollar): this is simply not beneficial for anyone.

Will the government be able to contain the depreciation of the ruble? Of course yes, because that’s what caused it! But the measures will only affect a sharp collapse, but further decline will occur for a long time. After all, this is beneficial for the budget and for the largest exporters - the most important producers of GDP and taxes in Russia.

Of course, there are those who do not benefit from a weak ruble. These are importers and manufacturers of products for domestic market. But, alas, they are deconsolidated, and therefore they do not have a single tough position that could influence the government.

In addition, a weak ruble is disadvantageous for Russian citizens. But who cares what they think?

The outgoing July turned out to be very hot in discussions regarding the prospects for the exchange rate of the Russian ruble. Checked in on this topic, probably everyone - officials, exporters, importers, stock analysts, etc.

A strong ruble means low inflation and, as a result, low interest rates. Global speculators are very fond of a strong ruble; accordingly, a strong ruble means an increase in Russian stock prices. Importers of goods are very fond of a strong ruble. A strong ruble allows Russian companies to import technology without any problems. Naturally, ordinary citizens like a strong ruble, because it makes travel abroad and high-quality imported goods affordable. Suffice it to recall the consumer boom of the mid-2000s.

A weak ruble is beneficial to the Russian budget, which is still largely formed by commodity exports. It is clear that it is much easier to collect taxes from Rosneft or Gazprom than from a large number of small enterprises that are still more or less operating “in the gray” - the size of the shadow sector in the Russian economy is estimated at about a quarter of GDP. Naturally, a weak ruble is also beneficial for exporters and import substitutes.

However, the fact is that the ruble exchange rate for Russia is primarily a political issue, not an economic one. And from a political point of view, Russia clearly needs a strong ruble. The point is not even that a strong ruble means low inflation and social stability in society. A strong ruble is the basis of Russia's geopolitical status as a global player. Eurasian integration and the role of Russia in the post-Soviet space. You can talk as much as you like about the great Soviet past, remember its achievements, but citizens former USSR They have been living in the bourgeois world for 25 years, and the overwhelming majority are thinking primarily from a financial point of view, clearly defining their economic interests. The Russian Federation will be attractive for the political integration of the former Soviet republics if and only if the standard of living, i.e. foreign exchange earnings, in Russian Federation will be significantly higher than in the rest of the post-Soviet space.

The core of the former USSR, Belarus, the Russian Federation and Kazakhstan can only be held together by a supranational Eurasian currency, which by definition should not be weak. However, the economies of Belarus and Kazakhstan are much smaller than the economy of the Russian Federation, which means that a hypothetical Eurasian altyn would be very similar to Russian ruble. Even if the Eurasian Central Bank is located in Almaty, and not in Moscow.

How to achieve a strong and stable ruble in the current difficult economic and political situation?

Perhaps it is worth remembering the old, long-forgotten currency corridor from the 90s. Everything new is well forgotten old. For most businesses and citizens, this would significantly reduce the risks of uncertainty. The Central Bank could, for example, fix the ruble exchange rate until August 1, 2017 at 65 rubles/$, limiting its fluctuations to +/- 10% of the established level. The CBR's ability to maintain financial stability is very serious; Russia's international reserves amount to almost $400 billion. Plus, of course, it is worth returning to the mandatory sale of foreign currency earnings by exporters in the amount of 50-75%.

It might also be a good idea to fix the exchange rates of the Russian ruble to the Belarusian and Kazakh tenge. However, this is, of course, the subject of negotiations with the national government. banks of Belarus and Kazakhstan.

Someone will remind you that the end of the currency corridor policy in August 1998 was very bleak. However, Russia then had a serious problem of short sovereign debt and dependence on external creditors. In fact, at that time the key decisions on Russian economic policy were made by the IMF. Russia's economic sovereignty was completely absent.

Now this problem simply does not exist.

The consequences of a falling currency exchange rate are not clear-cut. At first glance, the fall of the ruble is bad - inflation is rising, citizens are becoming poorer, and imported goods are becoming unavailable, especially when their analogues are not produced in our country. But the situation is not so clear-cut; for some, devaluation also has advantages.

1. Exporters

The weaker the ruble exchange rate, the more profitable it is for those companies that sell something abroad. It is not so important here - raw materials, grain or anything else. The fact is that export revenue is generated in foreign currency, and overhead costs (for example, salaries) and taxes are paid to exporting companies in rubles. Often Russian companies begin to sell their products abroad much cheaper than competitors and win markets. With the low ruble exchange rate, they can afford it and still be a big winner.

Another bonus for such companies is the increase in the value of their shares. Investors, anticipating increased profits, begin to invest in exporting companies.

2. Local producers

A weak ruble is beneficial for exporters and equally unfavorable for importers. When the ruble fell in early 2017, imports of many goods fell by 30% or more. The import of clothing, many household goods, food products, electronics and other goods into Russia has decreased in almost all product groups. However, some domestic enterprises They see this as an opportunity to win the market from their foreign colleagues. A clear example of this is import substitution in the food industry. Product manufacturers, following the rise in prices of foreign analogues, are increasing production. There is a similar potential in the Russian textile industry, but not everyone can implement it. True, consumers are not always happy about this - for them, the choice is narrowed.

However, devaluation for local producers is a double-edged sword. If companies take out loans in foreign currency, lease equipment, or purchase raw materials abroad, then they may not feel the positive effect. In addition, the inevitable rise in prices may reduce demand, so not all local producers will be able to benefit from this.

3. Budget and government

When the ruble weakens, more money flows into the budget. The effect is double. On the one hand, with a weak ruble exchange rate, we are increasing the export of hydrocarbons and getting more money from taxes on them. Russian companies receive income in dollars, and pay taxes in rubles - it turns out that they will be able to give the state more money.

On the other hand, a weak ruble provokes an increase in domestic prices, which is why the budget receives more of such large tax items, such as excise taxes, value added tax (VAT), income tax, profit tax and many others. Thus, devaluation is quick way replenish nominal budget revenues and fulfill their social obligations. The Ministry of Finance also forms savings in dollars, so it is directly interested in the weakening of the ruble. These funds can be used in the future to implement large production projects, the department said.

But here, too, not everything is so smooth. After all, budget expenses also increase, and a decrease consumer demand Due to high prices, it can greatly slow down the economy. Thus, a short-term positive effect can have much more unpleasant consequences in the future, for which citizens will pay.

4. Hotels and domestic tourism

When the ruble exchange rate drops sharply, many citizens look at the price tag of tour packages and decide to spend their vacation at home. Unfortunately, at normal rates, our resorts can rarely boast the same price-to-service ratio as Egypt, Spain or Turkey. Therefore, for them, the fall of the ruble is a chance to remove competitors and attract new customers. The situation is similar with travel agencies that organize tours around Russia.

Here, however, there is also controversial point. During devaluation real income citizens are falling, and many may not go on vacation anywhere at all.

5. Depositors and owners of currency

There is an obvious advantage for those who keep money in foreign currency. When their savings are converted into rubles, they will receive more money.

There is a certain advantage for those who keep money in rubles. The weakening of the ruble provokes an increase in inflation. This, in turn, forces the Central Bank to raise the key rate. Against the backdrop of growth key rate, banks are also increasing their own deposit rates. However, the risks of storing money also increase. If the state does not control the devaluation and cannot maintain it, then putting money in the bank will become much more dangerous.

Some countries deliberately use the depreciation of their currency to stimulate the economy - this is called “controlled devaluation”. However, in essence, for the economic growth in this case, the population always pays.