Oil and expected results: what will be the effect on the Russian economy

From the beginning of the year, the international reserves of the Russian Federation fell from $511 billion to $444 billion (at the peak, in August 2008, they reached $598 billion). On the one hand, it’s not surprising, the Central Bank hasn’t yet definitively allowed the ruble to float freely: about a half of the decline is a consequence of currency interventions (the rest is mostly a consequence of the weakening of the euro against the dollar). On the other hand, it’s time to wonder whether reserves of the Central Bank are sufficient? The third quarter of 2014 added to the problems of stagnating Russian economy at least two external shocks - Western sanctions and a marked decline in oil prices.

Now it's time to think: how stable is the economy itself? Especially since, according to the assessment of the balance of payments of the country, published by the Central Bank with the traditional delay, the answer is not as straightforward as the Kremlin and the Parliament Building think. Let’s recall that in early October, Vladimir Putin mentioned "a strong balance of payments" among the strengths of the Russian economy. Technically this is true, in the third quarter of 2014 imports were $79.7 billion, exports - $128.4 billion, a net outflow of capital - just $13 billion, the purchase of currency by the population - generally a penny, $1.5 billion.