The ruble is significantly overvalued, pushing Russia toward a current account deficit in the medium term, Deputy Economic Development Minister Andrei Klepach said Thursday.
"Our position is that it is overvalued — I think by at least 10 percent," Klepach told the Reuters Russia Investment Summit.
"Considering the huge gap between imports and domestic production, and given the longer-term risks — not what is happening right now or early next year, but within two years — we're moving toward a negative current account balance."
Thanks to high oil prices and increased gas exports to Europe, Russia saw a current account surplus of $57.6 billion in the first six months of this year. But the strong ruble makes imports more attractive, and those are set to rise by more than 30 percent in real terms this year.
Russia is on track to reach post-Soviet record-low inflation in 2011, and it may even come below the 6.5 percent to 7.0 percent official forecast, Klepach said.
"Our estimate is more or less 6.5 percent, maybe below," Klepach said.
Consumer prices have risen 4.6 percent since the start of the year, according to Wednesday's data from the State Statistics Service.
A Message from The Moscow Times:
Dear readers,
We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."
These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.
We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.
Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.
By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.
Remind me later.
