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accounts (-366 billion rubles, -2.5%) to term deposits (+797 billion rubles, +3.7%) due to rising interest rates. Interest rates climbed to 9.66% at the end of August compared to 8.11% at the end of July following the central bank's key rate hike in the middle of the month.
However, foreign currency balances continued to decrease, declining by 1.4 billion US dollars (-124 billion rubles in ruble equivalent, -3.1%).
In August, the growth of funds in escrow accounts significantly accelerated, increasing by 319 billion rubles or 7.0%, compared to 133 billion rubles or 3.0% in July. This surge was driven by record growth in mortgage lending (see page 3) and a slight reduction in the number of disclosed accounts due to delays in putting properties into operation (estimated at 213 billion rubles in August compared to 239 billion rubles in July 2).
GOVT FUNDS: In August, the volume of government funds remained relatively stable, experiencing a minor decrease of 40bn rubles, which accounts for a 0.3% change. During this period, the funds of the Federal Treasury saw a reduction of 312bn rubles, primarily due to the redemption of government bonds (net repayments amounted to approximately 300bn rubles). Conversely, the funds of regional budgets witnessed growth, increasing by 273bn rubles. This expansion is likely attributable to tax revenues that flowed into these budgets during the same period.
90 RUSSIA Country Report October 2023 www.intellinews.com