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Saturday, November 18, 2017

Bank of Russia releases notice on operations related to Reserve Fund accumulation

As of Feb. 19, in accordance with current procedure, the Bank of Russia will conduct its operations on the domestic FX market taking into account the transfer of funds in foreign currencies by the Ministry of Finance and the Federal Treasury to the Reserve Fund in the amount equivalent to $6.02 billion based on the results of 2013.

The conversion of this amount will be made evenly until late May by means of the daily purchases of foreign currencies from the Bank of Russia in the amount equivalent to $99.4 million a day.

The volume of the Bank of Russia interventions in case of foreign currency sales on the domestic market to smooth exchange-rate fluctuations will be reduced by the volume of the Federal Treasury foreign currency purchases from the Bank of Russia related to the accumulation of the Reserve Fund.

In case of foreign currency purchases, it will be increased by the corresponding volume. This adjustment of the Bank of Russia FX interventions will exert no significant influence on the exchange-rate dynamics of the national currency.

When the value of the dual-currency basket reaches the border of the operational band, the Bank of Russia will continue to conduct its interventions under the effective mechanism of the exchange-rate policy without limitations unless the value of the dual-currency basket returns to the operational band or the borders shift automatically so that the value of the dual-currency basket gets within the new borders of the operational band.

The cumulative volume of interventions leading to the shift of the operational band borders will be equal to the difference between the actual volume of operations and the volume of the Federal Treasury purchases of foreign currencies related to the accumulation of the Reserve Fund.