Kremlin blames loose monetary policy as rouble slides past 101 vs dollar
MOSCOW (Reuters) -President Vladimir Putin's economic adviser rebuked the central bank on Monday as the rouble slid past 101 per U.S. dollar, blaming its 30% year-to-date slump on loose monetary policy and revealing growing discord among Russia's monetary authorities.
The rouble, which has lost around a quarter of its value against the dollar since Putin sent troops into Ukraine in February 2022, hit 101.04 per U.S. dollar, its weakest point in almost 17 months.
As the rouble tumbled, Putin's economic adviser Maxim Oreshkin said in an op-ed for the TASS news agency that the Kremlin wanted a strong rouble and expected a normalisation shortly, an intervention that could spur the central bank into action ahead of its next scheduled interest rate decision on Sept. 15.
«The main source of rouble weakening and accelerating inflation is soft monetary policy,» Oreshkin wrote. «The central bank has all the tools to normalise the situation in the near future and ensure that lending rates are reduced to sustainable levels.
»A weak rouble complicates the economy's structural transformation and negatively affects the population's real incomes," he said. «It is in the interests of the Russian economy to have a strong rouble.»
The Bank of Russia, which hiked rates by 100 basis points in July to 8.5%, has blamed the rouble's sharp slide this year on Russia's shrinking current account surplus — down 85% year-on-year in January-July.
On Monday, the bank said it saw no financial stability risks from the rouble's weakening and gave another hawkish signal that a rate hike is possible soon.
'DAMNING INDICTMENT'
The rouble has chartered a turbulent course since Russia invaded Ukraine, slumping to a record low of 120 against the dollar in
Read more on investing.com
