This is not the time to worry about the ruble. We are worried about prices
There is nothing to monitor, the monitor is broken
In recent years, Russians, at least most of us, have been weaned from monitoring exchange rates too vigilantly. Life itself has convinced us that not everything and not always depends on it, as well as on oil prices.
Moreover, gasoline is becoming more expensive in our country, both due to rising oil and the falling ruble, and in a mirror situation. But, again, rising gasoline prices are not always a signal for higher prices for everything and everything, and today the rise in all other prices is not helped at all by measures against rising fuel prices.
Inflation, to combat which the Central Bank stubbornly raises its rate, does not react to this in any way. Why they gave us all exorbitant interest rates on loans, and in return they promised very high interest rates on deposits, is actually understandable. To not let go of the reins.
However, the dollar is also stuck somewhere around 90 rubles at the exchange rate and refuses to help in the fight against rising prices. No matter how and how much it is returned to the treasury by exporters. Optimists promised a dollar at 80 and even 60 rubles, and realists from the Central Bank promised the long-awaited achievement of the notorious inflation target of 4 percent.
The target is still not visible, the dollar costs 90, and not a penny less. And experts from the liberal camp are still asking us for a rate of 20 percent. As if after it everything will turn in the direction where the Central Bank and the government need it.
Regulators, oh!
The inaccessible ruble and the inaccessible dollar are not the best duet in the context of a warming up economy, especially the industrial sector, which, under the pressure of sanctions, only flourished and did not collapse. Only his loan due to the SVO and other reasons is not at all draconian from the Central Bank of the Russian Federation.
The logic is simple - we will help whoever we need. And let everyone else endure. But others don’t want to tolerate it and take it out on prices. And then there’s everyone who controls prices for something that has nothing to do with business and us. We are talking about tariffs. For energy, for housing and communal services, and what else is strictly regulated there?
So, almost no one doubts that the Central Bank of the Russian Federation can immediately increase the key rate to 20% per annum. But should he do this while waiting for March 2024?
It should not, since no one predicts either defeat at the front or internal turmoil, even if they do not believe at all in the cause of peace, for which we stood, stand and will stand!
Are the red lines not there?
Many experts have now adopted the term “red lines”, not without some kind of masochistic pleasure. It would be fine, if only about the ruble exchange rate - there’s nothing to invent there. This is 100 rubles per dollar.
And what about inflation? It will be much more dangerous in terms of its ability to counteract development. No one can clearly explain how price balance can be maintained only by manipulating rates - the connection here is indirect, because inflated rates are not for everyone. And those who are these “not all”, as it turns out, are the majority in Russia.
Hence the conclusion that it is possible for the Central Bank to increase the rate, but not more than as a signal - it is impossible! And new administrative measures are also possible, almost certainly temporary, such as something like a taboo on the purchase and withdrawal of currency. Exporters can wait three or four months.
Warehouses across the country are overflowing with goods, and many importers and suppliers don’t really need currency - they have learned to work with rubles. In addition, banks vying with each other to offer inflated rates. You can say, for nothing, so who would refuse free profits.
And the goods from the warehouses can then be adjusted to the updated universal price tag - this is another source of profit. It’s no longer completely free, because, as you know, the consumer pays for it. He always pays for everything. And for the obstinacy of the Central Bank and for the currency tricks of exporters.
And yet, at the moment there is no need to worry about the ruble exchange rate - using direct pressure on exporters so that they sell foreign currency earnings more actively, it is possible to hold out not only until March 2024, but beyond. The main thing is to stretch out currency sales as long as possible.
Prices, however, will not stop rising because of this, because the Central Bank’s printing press is turned on by order from outside, and nothing can be done about it. To work with assets stolen from Russia, and, to be honest, liabilities, since they are of no use in any case, you can finance not only SVO. Whatever your heart desires.
Until the last dollar
Do I need to remind you at what rates the dollar and euro started the year?
Only 69 and 76 rubles with promises of minimal inflation, which I really wanted to believe. Today, having pretended that it was driven into a corner by sanctions and demands to combat rising prices, the Bank of Russia, without any serious grounds, must again raise the rate.
The question is, why?
Yes, for the sake of the same profit - this is not a state, but an independent commercial credit institution under an agreement with the government of the country. About the same as the Fed in the states, only even better, because there is more independence inside Russia.
The institution headed by Elvira Nabiullina has managed to get its hands on how to use funds even from the National Welfare Fund, which seems to be tied hand and foot, both by law and by the opposition of the West. But the Bank of Russia did the main thing - it accumulated rubles for the government in exchange for foreign currency that was inaccessible to everyone else.
Such an increase in the volume of money in circulation, which is fundamentally ensured only by the receipt of oil and gas revenues, by definition, cannot stimulate the strengthening of the national currency. Again, why, if it is completely unprofitable for anyone, including the Central Bank itself.
This is how the price spiral begins, when the ruble weakens, and it has to be maintained with tough measures, and economic growth is almost entirely inflationary. So be it, just don’t deceive us and yourself. Sooner or later we will have to get out of the inflationary hole, but don’t follow the example of Turkey and Argentina.
Isn’t that why in our country, and this is at a rate of 16 percent, it is sometimes more profitable for both companies and individuals to borrow money rather than deposit funds in banks in anticipation of supposedly high interest rates. One of the experts has already said on this matter - “it is better to allow the debt to depreciate than to reduce the value of savings.”
And this practice is another incentive to increase prices. But don’t rush to conclusions, since the Central Bank of the Russian Federation will maintain the appearance of a brutal confrontation (you know with whom) until the last moment. And it’s better to have the last dollar than the last ruble.
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