© BloombergRussian Central Bank
Comments by Central Bank Chair Elvira Nabiullina confirm Russia will maintain tight monetary policy as it seeks to rein in inflation and to move from an economic model based on consumption towards one focused on investment, manufacturing and export.
With annualised inflation in Russia falling to 6.9% at the end of August, and with Russia reporting zero inflation in the first weeks of September, the strong indications are that the
Russian Central Bank is preparing to cut interest rates by 0.5% to 10% at its next meeting on Friday 16th September 2016.The Central Bank has indicated that it intends for the time being to keep its key rate 3% above the annualised rate of inflation. Since the annualised rate of inflation is now roughly 7%, following the logic of the Central Bank's own policy that should mean a cut in interest rates on Friday to 10%
Central Bank Chair Nabiullina calls interest rates of
10% against an annualised inflation rate of inflation of 6.9% and an underlying rate of inflation which may be as low as 5.5% a "moderately tight monetary policy".
Comment: The auctioning off of Brazil's resources is a step towards a very bleak future. While the funds might appear to provide a very short-term solution, such policies end in disaster. This has been part and parcel of neo-imperialism in the modern age. The economic downturn from the Western-based oil war will be nothing compared to what is coming. The people of Brazil are already outraged over the coup and protesting across the nation demanding, "Temer out!" Once the full force of these pro-Western economic policies get implemented, Temer may be heading for the hills.