Ruble’s weakening due to slowdown in economic growth in Russia – Siluanov

SYDNEY. Feb 23 (Interfax) – The ruble’s weakening observed since the start of the year is due to slowdown in Russia’s economic growth in the first place, not over the curtailment of the Quantitative Easing (QE) program by the United States, Russian Finance Minister Anton Siluanov told reporters.

“What happened to the ruble’s exchange rate at the start of the year is primarily connected with Russia’s macroeconomic parameters, first of all slowdown in economic growth, and with our companies’ and citizens’ expectations against the backdrop of the situation in other emerging economies,” he said after the G20 finance ministers and central bank governors’ meeting in Sydney.

Amid the current measures to curtail the QE program many of the emerging economies noted the importance of their accurate and carefully-weighed implementation, he said,

The heads of the Federal Reserve System and the Department of the Treasury issued clear signals which the U.S. financial authorities will follow in further implementing this policy. They are: 6.5% unemployment and 2.5% inflation,” he said, adding that this information should guide other countries in planning their macroeconomic policies.

“In countries which previously failed to hear the Federal Reserve System’s warning and failed to take appropriate measures to react on the curtailment of the QE program, adjustments on the financial markets were sharper than possible,” Siluanov said.

But Russia differs from other emerging markets, he continued.

Russia’s current account surplus was 1.6% of GDP in 2013, its budget was practically balanced, therefore the QE curtailment did not impact Russia as deeply as it affected other emerging markets, he said.

“Foreign investors did not withdraw from Russian stocks. We met with Euroclear representatives and they confirmed that foreign investors’ attitude to Russian stocks was rather conservative and they did not withdraw from them unlike in other emerging markets,” Siluanov said.