MOSCOW: Russia’s central bank will take care to avoid fuelling market volatility as it buys foreign currency to help rebuild the country’s rainy day fund, Finance Minister Anton Siluanov said on Tuesday. The central bank is due to start purchasing dollars on behalf of the finance ministry from Tuesday, part of efforts to replenish the Reserve Fund while prices for Russia’s Urals crude oil stay above $40 per barrel. It will buy the equivalent of 6.3 billion roubles — around $106 million at current prices — via the Moscow Exchange every day this month.
“We will buy foreign currency very carefully (so as) not to create consequences in the form of the rouble volatility,” Siluanov told reporters. He said the finance ministry could still spend from the Reserve Fund while making forex purchases. The dollars it buys could then be channelled into the Reserve Fund at the beginning of the next year, Siluanov added. People involved in top-level discussions on the forex purchases told Reuters the central bank had been reluctant to participate, fearing investors would regard them as currency interventions designed to weaken the rouble. The central bank and finance ministry have both said the plan to rebuild Russia’s reserves, depleted by low oil prices and international sanctions, does not compromise the rouble’s free float under a currency regime adopted in late 2014.
