Page 54 - RusRPTFeb22

7.1 FX issues
Experts of the Accounts Chamber of the Russian Federation said in a paper that the budget’s dependence on oil prices is decreasing.
In the digest Economic Monitoring, prepared by the Accounts Chamber’s Department for Audit of Economic Development, the experts wrote that over the years, the correlation coefficient between the oil price and the dollar exchange rate has decreased from -0.91 in 2016 to -0.61 in 2020.
The Accounts Chamber explained that the drop in the index was recorded after the introduction of a floating ruble exchange rate, the Central Bank's transition to an inflation targeting policy, and the application of the budget rule. Thus, in 2014-2017, when oil prices moved from $112 to $24 per barrel, an absolute change of more than 3.6 times, the fluctuation of the ruble against the dollar was from 33 to 84 rubles, or 1.5 times.
At the same time, for the period from January 2018, when the budget rule came into effect, to February 2020, when oil quotations changed in the range from $85 to $48 per barrel, or about 80%, the fluctuation of the ruble against the dollar was in a relatively narrow range of 56 to 70 rubles, or 25%.
As a result, the JV analysts concluded that oil prices continue to affect the
54 RUSSIA Country Report February 2022 www.intellinews.com