Page 84 - RusRPTSept23

capital movements.
The ruble's weakening is mainly due to the melting of Russia's exceptionally large current account surplus last year. According to the Russian central bank's preliminary estimate, the current account surplus was only $25bn in January-July, or 85% lower compared to last year's peak figures.
The ruble remained under the pressure of a declining foreign trade surplus in July, as sales of revenue of exporters in foreign currencies fell by 1.6% to $6.9bn, the central bank said in a report on August 8.
The ruble has lost nearly half its value since the start of the war as the ruble dollar exchange rate approaches RUB100 from around RUB60 shortly after the start of the Ukraine war in 2022.
"The amount of net sales of foreign currency by the largest exporters decreased by 1.6% (in July) from the level of June to $6.9bn from $7bn. The ratio of net foreign currency sales to the foreign currency revenue of the largest exporters (without the ruble component), amounted to 84% in June (after 88% in May with adjustments)," the central bank said.
Sales of foreign currency by banks of systemic importance rose to RUB528bn in July from RUB377bn in June, with the largest banks being the leaders by sales. Smaller banks made net purchases of RUB524bn in July after 400bn rubles in June.
After the ruble on the Moscow Exchange dropped to 98 against the dollar on August 9, and almost to 108 against the euro, the Central Bank announced that it would stop buying foreign currency under the budget rule until the end of the year "in order to reduce the volatility of financial markets." Deferred purchases may be held in 2024. The regulator will continue to compensate for the spending of the National Welfare Fund in the first half of the year by selling foreign currency - in the amount of 2.3bn rubles a day.
The ruble has weakened against the dollar by 24% since the beginning of the year and took a place in the worst three national currencies along with the Turkish lira and the Argentine peso, writes Bloomberg.
The decision of the Central Bank did not help the ruble at all: the dollar moved away from 98 only to the area of 97.1 - this is still the level of the end of March 2022.
The fact that the days of the budget rule are numbered even in its current truncated form (yuan is bought when oil and gas revenues exceed 8 trillion rubles a year and sold when there is a shortfall, it is impossible to compensate for the budget deficit with excess revenues) became clear last week. The Bell dedicated a final newsletter to this. The main conclusion is that although the
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