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The Central Bank of Russia has returned to the practice of currency interventions in a situation of a sudden depreciation of the ruble. Fr om the beginning of October, the bi-currency basket is traded close to the upper limit of the floating operating interval.

On Thursday, October 16, 2014, the Central Bank of Russia withdrew the licenses of three credit institutions. That regular measure taken by the regulator is worth mentioning because the number of credit institutions which were deprived their licenses to carry out operations from the date Elvira Nabiulina took the office of the Chairman of the Central Bank of Russia – that is, from July 2013 till the present day -- has amounted to 100.

The Russian national currency, like the currencies of major developing countries, keeps devaluing steadily. The ruble exchange rate has been pressured by both geopolitical risks and further cuts on monetary easing programs in the U.S. economy, and fall in prices of energy resources.

In conditions of limitation of access of Russian companies to Western debt markets, the banking sector has become completely dependent on the Central Bank of Russia.

In 2015, export duties on oil used for production of oil products for export to Europe will not be transferred to the Russian budget; as a result of that Belarus will save about $1.5bn in addition to those $1.5bn which was decided to leave to Belarus under the previous agreements.  

The Central Bank of Russia has rejected the information on limitation of capital movement. However, the Russian public is traditionally quite skeptical about such statements made by the authorities. In addition to the above, in the current complicated economic situation the issue of independence of the Central Bank of Russia is being discussed.

The Russian ruble, as well as currencies of large developing countries tends to depreciate dramatically against the world's major currencies.

Rosneft, a largest taxpayer, the BAM (Baikal-Amur Railway) and the TRANSSIB ( The Trans-Siberian Railway) which are essential for the Far East Region, high-tech projects are competing for the entitlement to spend the National Wealth Fund's resources.

On October 30, the Central Bank of Russia renewed currency interventions because the ruble exchange rate hit through the upper limit of the band. It is to be noted that the Central Bank of Russia changed the mode of supplying foreign exchange to the market having given up direct sales of the foreign exchange and carried out one-day currency swap deals in the volume of $581.4m.

Rough analysis of Russia's external statistics shows that the Russian economy is having satisfactory formal indicators of foreign exchange liquidity.

The recently introduced economic sanctions may potentially result in serious constraints on the future development of Russia's oil and gas sector. At the same time, the resulting negative effect on the oil and gas sector's prospects will be determined by the actual length of the period of their realization.

On 22 September 2014, the anti-corruption expert's estimation of a draft of the Federal Law 'On the Federal Budget for 2015 and the Planning Period 2016 - 2017' was completed; the text of the draft law itself was posted a week earlier to the Single Portal for the publication of information on the elaboration, by federal bodies of state executive authority, of drafts of normative legal acts and the results of their public discussion at regulation.gov.ru.

The World Bank has recently published its report on the Russian economy in which its analysts point to the threat of Russia entering a period of stagnation or even recession in the foreseeable future. For instance, under a baseline scenario, according to the World Bank's forecast, the Russian economy would grow 0.5% in 2014 relative to the previous period, and 0.3% in 2015 and 0.4% in 2016, respectively. Economic growth would average 1% in the period between 2015 and 2016 under an optimistic scenario, whereas a long-lasting recession is expected under a pessimistic scenario (-0.9% in 2015 and -0.4% in 2016).

Draft Guidelines for the Single State Monetary Policy in 2015 and for 2016 and 2017, published on September 12, 2014, suggests that the Bank of Russia will keep its monetary policy unchanged in general.

On September 18 the Government of the Russian Federation approved a draft federal budget for the mid-term perspective, and the Ministry of Finance gave initial comments on the key parameters of the fiscal policy in an investment forum in Sochi.

On September 15, oil prices fell to $97 a barrel (Brent oil). Simultaneously, the ruble depreciated against global currencies to the historic minimum (over Rb 38.3 per a US dollar). What does it mean to the federal budget whose oil and gas revenues depend directly on oil prices? What are the prospects of this year?