And the Russian population is getting poorer.
May 7, the dollar in Russia after a short period of strengthening began to fall again and reached below 60 rubles. However, the next strengthening of the ruble did not comfort either Russian experts or Russian economists, who give numerous comments to the media, which threatens Russia to strengthen the ruble.
The strengthening of the ruble in Russia specific reasons that have nothing to do with strengthening the economy, and the consequences of this unnaturally strong ruble are hitting the Russian economy, both at the domestic and macroeconomic levels.
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Macroeconomic level < The main trick of the strong ruble is that it kills revenues from the main source of income of the Russian budget - energy exports.
“Exporters are uncomfortable at the current exchange rate, given that they have increased transportation costs, difficulties with insurance, with payments, despite the fact that they are also forced to offer discounts in many positions of their exports , coming to new markets. Taken together, this makes the export of very important commodities from the country unprofitable, even if someone has banned their supply or not. And this is a big problem, “says the chief economist of the Russian company” PF Capital “Eugene Nadorshin.
According to him, the strengthening Russian ruble is doing what no Western sanctions have been able to do.
“The ruble in current values, especially if it continues to play again, contrary to the actions of, in particular, the Central Bank, is the threat of a sharp decline in exports, which will affect us all. And it will respond with a much deeper fall in GDP than currently planned. That is, such a situation with exports may increase, double the rate of current decline. And pay attention, this does not require additional sanctions, “- said the expert.
This assessment is typical for expert economists, who, unlike politicians, often do not want to risk their reputation by claiming that a strong ruble is evidence of the success of the Russian economy.
“Too strong a ruble exchange rate is primarily detrimental to mining companies, which are part-time exporters of raw materials or products of low redistribution. In the past, they have always won in situations of economic and foreign policy crises, which have invariably been accompanied by a fall in the exchange rate of the domestic currency, “said Mikhail Alov, Managing Director of Algo Capital.
According to the expert, another serious macroeconomic problem due to the excessively high ruble exchange rate is the deterioration of the federal budget from the mining and exporting sector.
“It is too early to worry about that. However, we should not forget that social programs and benefits in times of economic turmoil are not only increasing, but also subject to indexation. It is obvious that in the coming years the expenditure part of the state budget should increase sharply, ”he said.
Household level
The Russian government has long learned to provide its citizens with convenient information. One of the last was the strengthening of the ruble.
However, economists emphasize that a strong ruble leads to impoverishment of the population of Russia.
“I would not be in a hurry to rejoice. Note that we have an expensive ruble, but we do not have cheap imports. There is no reason to rejoice in a strong ruble. It is not broadcast at low prices for households, ”says Yevhen Nadorshyn.
“It is no secret that the key contribution to accelerating inflation in Russia has traditionally been the increase in the value of imported goods. Their rise inevitably occurs due to a significant weakening of the ruble. Today we see its strengthening However, even the flexible and competitive consumer electronics industry is not responding well enough to the current situation, “Mikhail Khanov echoed.
In addition, the almost two-fold strengthening of the ruble was a bad joke with many importers.
“As a result, we are dealing with an already 'dependent' product that is being offered at too high a price and is selling poorly,” says Khanov.
Also affected were those Russians who in a period of devaluation of the ruble hastened to protect themselves from this by buying currency or shares. As a result, the dollar was cheaper against the ruble, as in early 2020. And trading in shares of large North American companies on the Moscow Stock Exchange is still frozen and has not resumed.
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“The current strong exchange rate of the Russian currency is not yet clearly reflected on the shelves of grocery stores. Many food products of domestic and foreign production rose sharply, following the general rise in prices. And the opposite trend is not observed yet, except for some seasonal positions, which are traditionally cheaper by the beginning of summer, “he said.
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