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forecast currently looks too optimistic.
The recent ruble weakening is seen as a combination of the fundamental influence of the balance of payments (realised with a lag), decreased liquidity on the Russian currency market, and one time factors such as large Fx transactions in the foreign assets pulling out of Russia deals.
"The current account balance will always be such as to meet the demand for saving in foreign assets (i.e. the demand for capital outflows), and the exchange rate will be exactly such as to provide an appropriate current account," Alexander Isakov of Bloomberg Economics argued.
86 RUSSIA Country Report July 2023 www.intellinews.com
