Head of Russian Central Bank: No devaluation in Russia

Russia’s chief banker sees no reasons to expect devaluation of Russia’s national currency, the ruble, in the near future. “There has been no usual exchange rate policy in the country for the past four years, there is a policy of restricting volatility. Speculating about devaluation in a situation like this is senseless, because devaluation comes from the state,” Ignatiev told the State Duma. “The exchange rate moves all by itself.” First Deputy Prime Minister Igor Shuvalov told the media earlier that the Finance Ministry’s decision to start buying up foreign currency did not mean devaluation of the ruble. “Devaluation happens when your trade balance changes drastically, when there are no bank interventions and the exchange rate breaks loose,” he said. “We have nothing of the sort. Our trade balance is still in the black.” He argued that the decision to buy currency that was made several years ago has nothing to do with devaluation. “In order to avoid excessive firming of the ruble the Ministry of Finance may buy foreign currency for rubles, there will be more liquidity and no firming will happen. That’s an agreed policy of the Ministry of Finance and the Bank of Russia,” Shuvalov said.