Page 98 - RusRPTOct23

“In our view, the time of the CBR transition to policy easing, as in previous similar cycles, will be determined by what will be the sustainable component of inflation beyond the transfer of the ruble depreciation effect to prices, i.e. at the end of 2023 - beginning of 2024,” RenCap analysts believe.
The CBR also maintained its stance on the undesirability of tightening capital controls to influence the ruble exchange rate, calling to rely instead on natural correction factors and already implemented monetary tightening.
RenCap analysts also note that CBR’s 6%-7% inflation forecast for 2023 differs quite significantly from the latest estimates of the Ministry of Economic Development (7.5% guidance for 2023).
“Given both the announced discussion around preferential loan programmes and the differences in growth forecasts, we would not be surprised that in 2024 we will again see an intensification of the discussion between the government and the CBR around the necessary level of policy tightness,” RenCap wrote.
98 RUSSIA Country Report October 2023 www.intellinews.com