CBR Quarterly Inflation Review - Q2 2006
Central bank: cbr | Type: quarterly_review | Date: 2006-06-30

THE CENTRAL BANK
OF THE RUSSIAN FEDERATION
(BANK OF RUSSIA)
Quarterly
Inflation
Review
2006 Q2
Research and Information Department
Introduction........................................................... 1
Inflation Dynamics ................................................... 3
Quantitative and Qualitative Monetary Indicators .......... 17
Statistical Addendum ............................................. 25
1 2006 Q2
Inflation Dynamics
Introduction
The trend towards the slowing of growth in
consumer prices continued in Russia in the first
half of 2006. Core inflation decreased and growth
in the prices of goods and services excluded from
the calculation of the core consumer price index
decelerated year on year.
The slowing of growth in the prices of paid
services provided to the population, including ad-
ministered prices, had a positive effect on con-
sumer price inflation in January-June 2006. The
growth in these prices was also curbed as Russia
adopted in 2005 amendments to Federal Law No.
210-FZ, dated December 30, 2004, “On the Prin-
ciples of Regulating Tariffs Set by House Mainte-
nance and Utility Services” and the Federal Tariff
Service’s Order No. 853-e/4, dated December 29,
2005, setting limits on growth in housing and util-
ity charges for each region.
Core inflation decreased largely due to the
slowing of growth in food prices, excluding veg-
etable and fruit prices. The dynamics of these
prices in January-June 2006 were affected by a
sharp increase in granulated sugar prices due to
lower domestic sugar supply and world sugar price
growth, on the one hand, and a considerable slow-
down in the growth of prices for meat and poul-
try, fish and seafood, on the other hand.
Growth in non-food prices slowed down.
Motor petrol prices grew faster than non-food
prices in January-June 2006; however, their
growth rates did not exceed last year’s level.
The stable foreign exchange rate was an
important factor determining positive inflation-
ary expectations and contributed to lower infla-
tion.
The Bank of Russia considerably stepped up
its currency interventions in January-June 2006
year on year amid a significant inflow of foreign
exchange from operations registered on the cur-
rent account of Russia’s balance of payments, and
also a large-scale net private capital inflow (in Q2).
As Russia’s international reserves grew signifi-
cantly to exceed the figure for the entire past year,
the Bank of Russia carried out more active
sterilisation measures (especially in Q2) to reduce
inflationary pressure. In particular, the Bank of
Russia made decisions to raise interest rates on
deposit operations on standard terms and adjust
rates on operations at deposit auctions and with
Bank of Russia bonds (OBR bonds). Operations
with OBR bonds and deposit operations remained
the Bank of Russia’s major instruments to attract
funds.
As was the case in the previous year, the
Stabilisation Fund of Russia (hereinafter the
Stabilisation Fund) and the accounts of the Rus-
sian Government with the Bank of Russia ab-
sorbed a considerable part of aggregate liquidity.
However, the increase in the cut-off price of oil
from $20 to $27 per barrel from January 1, 2006,
reduced the Stabilisation Fund’s absorption poten-
tial. As a result, the Bank of Russia will have to
take greater efforts to control money supply
growth.
Monetary measures and the Stabilisation
Fund helped sterilise a considerable part of free
liquidity. At the same time, M2 growth in the mov-
ing 12-month period accelerated in January-June
2006 to 43.9% as of July 1, 2006, compared with
July 1, 2005.
However, low-liquidity ruble components
(time deposits) prevailed in the structure of ruble
supply growth and represented a significant fac-
tor from the viewpoint of alleviating the inflation-
ary consequences of monetary growth. At the
same time, the trend registered for most of the
period under review towards the contraction of
cash in the M2 structure had a positive effect on
inflation and money velocity.
Considering the macroeconomic situation
and a larger-than-expected decline in money ve-
locity, the Bank of Russia reviewed its estimate of
demand for ruble supply and raised it from 25-
28% to 33-37%. However, money supply contin-
ues to grow significantly from the viewpoint of
complying with the adjusted indicators of demand
for money this year. Therefore, monetary pres-
sure on inflation will persist in the medium- and
2006 Q2
long-term perspective. The accelerated growth in
M2 this year means that it will exert greater influ-
ence on inflation in 2007.
Core inflation dynamics suggest that core
inflation is less sensitive to short-term money sup-
ply growth. Therefore, in the second half of 2006,
core inflation will be affected (other conditions
being unchanged) by money supply dynamics reg-
istered by the beginning of the year and the cur-
rent foreign exchange rate, and also by the com-
ing budget non-interest expenditures and the
scope of revenue accrual in the Stabilisation Fund.
3 2006 Q2
Inflation Dynamics
Inflation Dynamics
Consumer prices
According to the Federal State Statistics Ser-
vice (Rosstat), consumer prices rose 6.2% in Janu-
ary-June 2006 against 8.0% in the same period
of 2005. Consumer prices grew 1.1% as a whole in
2006 Q2 (5.0% in 2006 Q1). Consumer prices in-
creased 0.4% in April, 0.5% in May and 0.3% in
June 2006.
Consumer price inflation in the moving 12-
month period stood at 9.0% in June 2006 (9.4%
in May 2006), or 0.7 percentage points lower than
the figure corresponding to the smooth move-
ment towards achieving the 2006 monetary policy
target (8.5%).
Core inflation equalled 3.9% in the first
half of 2006 (4.4% in the first half of 2005). The
prices of goods and services included in the calcu-
lation of core inflation rose 1.1% in 2006 Q2 (2.8%
in 2006 Q1). The core consumer price index grew
0.4% in April, 0.4% in May and 0.3% in June. In
the moving 12-month period, core inflation stood
at an estimated 7.8% in June 2006.
Growth in the prices of goods and services
included in the calculation of the core consumer
price index in the first half of 2006 accounted for
an estimated 3.0 percentage points, or 48.4%, of
overall consumer price growth as against 3.5 per-
centage points, or 44.1%, in January-June 2005.
Food prices, excluding vegetable and
fruit prices, grew 4.5% in January-June 2006 as
against 5.5% in the same period of 2005. Food
prices, excluding vegetable and fruit prices, in-
creased 3.9% in 2006 Q1 and 0.6% in 2006 Q2.
Growth in food prices, excluding vegetable and
food prices, accounted for an estimated 1.8 per-
centage points, or 28.6%, of overall consumer
price growth in the first half of 2006 as against
2.3 percentage points, or 29.0%, in the same pe-
riod of 2005.
Granulated sugar prices registered a sharp
increase at the beginning of 2006: they grew
10.7% in January, 30.3% in February and 48.8%
in 2006 Q1. In 2006 Q2, granulated sugar prices
declined. In January-June 2006, granulated sugar
prices increased 30.4% (1.4% in the same period
of 2005). Sugar price dynamics on the domestic
market largely followed changes in the world
prices of refined sugar, and also raw sugar whose
imports in the first six months account for the
entire output of granulated sugar in the country.
Reduced domestic sugar production had an ad-
verse effect on sugar price dynamics.
The rapid growth in sugar prices at the be-
ginning of 2006 affected core inflation consider-
ably. Sugar price growth in January-June 2006
contributed an estimated 0.4 percentage points
2006 Q2
Consumer price inflation (%)
Growth (June 2006 on
December 2005)
Growth (June 2005 on
December 2004) Outcome
Prices of goods and services included in core inflation calculation 3.9 4.4 Retardation by 1.1 times
of which:
- food prices, excluding vegetable and fruit prices 4.5 5.5 Retardation by 1.2 times
- non-food prices 2.3 2.4 Some retardation
Prices of paid services provided to households 10.0 15.4 Retardation by 1.5 times
of which:
- administered prices of goods and services 11.1 19.3 Retardation by 1.7 times
Vegetable and fruit prices 31.5 40.6 Retardation by 1.3 times
5 2006 Q2
Inflation Dynamics
Food price inflation rates (%)
Growth (June 2006 on
December 2005)
Growth (June 2005 on
December 2004) Outcome
Bread and bakery products 6.3 1.6 Acceleration by 3.9 times
Cereals and legumes 9.0 - 1.6
Pasta 3.2 1.7 Acceleration by 1.9 times
Meat and poultry 2.2 14.6 Retardation by 6.6 times
Fish and seafood 4.2 10.7 Retardation by 2.5 times
Milk and dairy products 3.2 2.7 Acceleration by 1.2 times
Butter 3.0 2.4 Acceleration by 1.3 times
Sunflower oil -0.9 2.0
Granulated sugar 30.4 1.4 Acceleration by 21.7 times
Alcoholic beverages 4.0 4.4 Retardation by 1.1 times
to overall growth in the prices of goods and ser-
vices included in the calculation of the core con-
sumer price index.
The situation on the meat market stabilised
in 2006. Meat and poultry prices increased 2.2%
in January-June 2006 (14.6% in the same period
of 2005). Poultry price dynamics significantly af-
fected meat and poultry prices.
Poultry prices fell 9.2% in January-June
2006, whereas they grew 18.9% in January-June
2005. Beef and pork prices went up 8.8% and
5.2%, respectively, in the first six months of 2006
compared with 16.8% and 11.7% in the same pe-
riod of 2005.
On December 5, 2005, the Russian Govern-
ment adopted Resolution No. 732, setting for the
first time meat import quotas for four years in
advance. This mechanism allows foreign trade
companies to carry out a more balanced import
policy and cushion undesirable supply-related
market fluctuations.
Fish and seafood prices rose 4.2% in the first
half of 2006. This growth is 2.5 times slower than
the figure registered in the same period of 2005
when fish and seafood prices went up 10.7%.
The prices of milk and dairy products grew
3.2% in January-June 2006 as against 2.7% in
January-June 2005.
In January-June 2006, compared with the
same period of 2005, growth accelerated in the
prices of bread and bakery products (from 1.6%
to 6.3%) and pasta (from 1.7% to 3.2%). The
prices of cereals and legumes grew 9.0% (in Janu-
ary-June 2005, they went down 1.6%). Growth
in the prices of these products accelerated as ag-
ricultural producer prices for grain crops rose con-
siderably (by 12.6%) in January-June 2006 (in
January-June 2005, these prices declined 3.2%).
In the estimate of the Russian Ministry of Agricul-
ture, the grain harvest will be smaller in 2006 than
in 2005.
In January-June 2006, as in the same period
of 2005, food prices, excluding vegetable and fruit
prices, grew faster than non-food prices.
Non-food prices rose 2.3% in January-June
2006 against 2.4% in the same period of 2005.
Non-food prices grew 1.3% in 2006 Q1 and 1.0%
in 2006 Q2. The biggest growth in non-food prices
in the first half of 2006 was registered in the prices
of detergents, tobacco products and building
materials, which increased 3.5%.
Petrol prices rose 2.6% in January-June
2006 (also 2.6% in January-June 2005).
2006 Q2
Growth in non-food prices accounted for an
estimated 0.8 percentage points, or 12.9%, of
overall consumer price growth in the first six
months of 2006 as against 0.8 percentage points,
or 9.8%, in the same period of 2005.
Vegetable and fruit prices rose 31.5% in
January-June 2006 as against 40.6% in January-
June 2005. The increase in vegetable and fruit
prices in the first six months of 2006 was slower
than their average growth in January-June 2001-
2005.
Growth in vegetable and fruit prices ac-
counted for an estimated 1.2 percentage points,
or 20.2%, of overall consumer price growth in
January-June 2006 as against 1.7 percentage
points, or 20.8%, in the same period of 2005.
Food prices grew 7.0% as a whole in the
first six months of 2006 compared with 8.6% in
the same period of 2005.
The prices of paid services provided to
households went up 10.0% in January-June 2006
as against 15.4% in January-June 2005. The prices
of paid services provided to households grew
8.0% in 2006 Q1 and 1.9% in 2006 Q2. Housing
and utility prices increased 16.0% in the first six
months of 2006 (29.1% in January-June 2005),
with housing prices rising 14.9% and utility prices
16.7%. At the beginning of 2006, the amend-
ments to Federal Law No. 210-FZ, dated Decem-
ber 30, 2004, “On the Principles of Regulating
Tariffs Set by House Maintenance and Utility Ser-
vices” and the Federal Tariff Service’s Order No.
853-e/4 of December 29, 2005, came into force,
setting limits on growth in housing and utility
charges for each region and establishing the pro-
cedure for monitoring their dynamics. Housing
and utility prices grew 13.8% in January 2006
month on month. In the subsequent months, their
growth slowed down to an estimated 0.4% in
2006 Q2.
Passenger transport fares and communica-
tion fees rose 10.9% and 0.3%, respectively, in
January-June 2006 (10.4% and 0.6%, respec-
tively, in January-June 2005).
As for other major types of services, the
most significant increase in January-June 2006
7 2006 Q2
Inflation Dynamics
was registered in pre-school tuition fees, which
rose 22.7% as against 21.9% in the same period
of 2005.
Growth in paid service prices in January-June
2006 was two times faster than overall growth in
the prices of goods, which stood at 5.0% (2.6
times faster in January-June 2005). Growth in paid
service prices in January-June 2006 accounted for
an estimated 2.4 percentage points, or 38.3%, of
overall consumer price growth as against 3.2 per-
centage points, or 40.5%, in January-June 2005.
Administered service prices rose by an estimated
11.1% in the first six months of 2006 as against
19.3% in January-June 2005.
The analysis of the distribution
1 of con-
sumer price increases (June on December of pre-
vious year) in 2002-2006 was based on a sample
of more than 400 consumer goods and services
and made without taking account of their weights
in consumer spending.
In the past five years, the prices of more
than two-thirds of consumer goods and services
included in the sample grew within the range of
2-8% in January-June. At the same time, in Janu-
ary-June 2006, the prices of almost a half of con-
sumer goods and services (48.8%) grew within
the range of 0-4% (45.2% of consumer goods
and services in January-June 2005 and 43.1% in
January-June 2004). Price increases in the first six
months of 2002 and 2003 were largely within the
range of 4-8%.
In the past three years, the median, which
in this kind of distribution, characterises growth
in the prices of the bulk of goods and services has
been virtually unchanged (it stood at 3.8% in
January-June 2004-2005 and 3.7% in January-
June 2006). The distribution average decreased 1.2
percentage points in 2006 year on year to 5.2%.
The standard deviation, which characterises the
extent of price growth difference from the aver-
age, declined to 7.6% from 12.4% a year earlier
1 This distribution has been built on the basis of a smoothed histogram. The length of the interval (4 percentage points) was
selected so that each interval included a sufficient number of observations, while the histogram reflected the qualitative charac-
teristics of the sample distribution.
2006 Q2
but was larger than in 2004 (6.3%). The disper-
sion of price increases narrowed in January-June
2006 year on year as the standard deviation for
paid services and food products decreased con-
siderably. In January-June 2006, the median was
the highest in the sector of paid services and the
lowest in the sector of non-food products.
A statistical analysis of food price increases
indicated an insignificant rise in the distribution
median in January-June 2006 year on year. The
prices of almost a half of all foodstuffs (47.3%)
grew within the range of 4-8% in the first six
months of 2006. In the same period of 2005,
growth in the prices of a large part of food prod-
ucts (38.4%) did not exceed 4%. The standard
deviation decreased from 20.3% in January-June
2005 to 12.9% in January-June 2006. At the same
time, there was a relatively large group of goods
(over 7%) with the price growth of more than
28%.
The distribution of non-food price increases
was characterised by a pronounced maximum and
a small standard deviation. Therefore, the in-
creases in the prices of most goods in this group
remained within a narrow range. Thus, in Janu-
ary-June 2006, goods in the 0-4% price growth
range accounted for 70.9% of all non-food prod-
ucts. In the same period of 2005, this price growth
range accounted for 64.2% of goods. The stan-
dard deviation for non-food products was 2.4%
or 3.2 times smaller than the standard deviation
for goods and services as a whole.
The distribution of service price increases in
January-June 2006 was characterised by a peak
corresponding to the 4-8% price growth range.
In January-June 2005, the prices of a considerable
share of services (11.2%) declined, while a rela-
tively large share of services (8.4%) registered the
price increase of over 28%. In January-June 2006,
the corresponding proportions of these services
contracted to 4.5% and 0.9%, respectively. The
standard deviation decreased to 5.8%, which is
2.2 times smaller than in the first half of 2005.
According to Rosstat’s data, consumer price
growth in all of Russia’s federal districts was
slower in January-June 2006 than in the same pe-
riod of 2005.
According to estimates, differences be-
tween the constituent members of the Russian
Federation with respect to the cost of a fixed set
of goods and services used by the Federal State
Statistics Service for interregional comparisons of
household purchasing power increased in January-
June 2006. The regional difference ratio
2 increased
to 44.9% in January-June 2006 from 43.1% in
January-June 2005.
In January-June 2006, vegetable and fruit
prices demonstrated the largest differences in
growth rates by region. Thus, vegetable and fruit
prices grew 43.7% in the Southern Federal District
and 21.8% in the Far Eastern Federal District.
Growth in the prices of non-food products and
foodstuffs, excluding vegetables and fruit, was
roughly the same in all the federal districts.
In January-June 2006, growth in the prices
of paid services provided to households slowed
down considerably in all the federal districts com-
pared with the same period of 2005. The most
considerable slowdown was registered in the
Southern and Far Eastern Federal Districts where
growth decelerated by 7.9 and 10.0 percentage
points, respectively (growth in service prices
slowed by 5.4 percentage points across Russia as
a whole).
According to data provided by the Institute
of the Economy of the Transitional Period, the in-
flationary expectations of managers at leading
2 The regional difference ratio is calculated as the difference between the cost of a fixed set of goods and services in the mos t
expensive and the cheapest regions relative to the national value of the same set.
9 2006 Q2
Inflation Dynamics
industrial enterprises were lower in January-June
2006 than in the same period of 2005. In particu-
lar, up to 36% of respondents predicted growth
in selling prices (up to 38% in January-June 2005).
Producer Prices
Industrial producer prices gained 9.4% in
the first six months of 2006 as against 9.8% in
January-June 2005. Growth in producer prices in
the mining sector contributed an estimated 3.1
percentage points, or 32.9%, to overall producer
price growth in January-June 2006 (4.4 percent-
age points, or 45.1%, in the same period of 2005).
Growth in producer prices in the mining sector was
1.5 times faster than in industry as a whole and
stood at 13.9% in the first six months of 2006,
while fuel and energy prices grew 13.7% (22.5%
and 24.6%, respectively, in the same period of
2005).
Producer prices in manufacturing industries
grew 7.7% in January-June 2006 compared with
5.4% in January-June 2005. The biggest producer
price growth in this sector was registered in the
production of petroleum products (18.3% com-
pared with 7.3% in the same period of 2005).
Competition, especially on the part of im-
porters, continued to affect price formation in the
manufacturing sector, which is largely oriented to
consumer demand. This became apparent as pro-
ducer prices in the production of food, including
beverages, tobacco, textile and clothing and
leather, leather goods and footwear grew slower
than in the manufacturing sector as a whole.
In the manufacturing industries whose out-
put goes to the consumer goods market, price
growth accelerated in January-June 2006 year on
year only in the production of food, including bev-
erages, and tobacco (from 1.9% to 4.3%). At the
same time, price growth slowed to 1.6% in textile
and clothing production, and to 3.1% in the pro-
duction of leather, leather goods and footwear.
In January-June 2005, producer prices in these
types of activity rose 1.7% and 3.3%, respectively.
In January-June 2006, growth in producer
prices in industries whose output goes directly to
the consumer goods market accounted for an es-
timated 2.0 percentage points, or 51.5%, of overall
2006 Q2
growth in the prices of goods and services included
in the calculation of core inflation (1.2 percentage
points, or 26.6%, in the same period of 2005).
Producer prices in the production, transmis-
sion and distribution of electricity rose 9.6% in the
first six months of 2006 as against 11.3% in Janu-
ary-June 2005.
Freight transportation charges increased
8.8% (20.3% in the same period of 2005). Rail-
way fares grew 8.9% in January-June 2006 as
against 8.8% in January-June 2005.
Communication fees for corporate enti-
ties declined 1.0% in the first six months of 2006
(in January-June 2005, they increased 0.2%).
Growth in the prices of building materials
was moderate in January-June 2006 (4.4%) as in
January-June 2005 (6.2%).
Agricultural producer prices rose 0.8% in
the period under review (2.2% in January-June
2005). The main contribution to the price increase
was made by growth in crop growers’ prices,
which went up 9.0% in the first six months of
2006 as against 1.2% in the same period of 2005.
The biggest growth over that period was regis-
tered in potato and cereals prices, which increased
36.6% and 12.6%, respectively (in January-June
2005, potato prices grew 27.1%, whereas cereals
prices declined 3.2%).
Livestock breeder prices slipped 4.0% in
January-June 2006 (in January-June 2005, they
went up 2.8%). Cattle and poultry prices fell 0.5%
and milk prices decreased 3.0%. In January-June
2005, cattle and poultry prices went up 13.4%,
whereas milk prices were down 0.3%. In January-
June 2006, as in January-June 2005, egg producer
prices registered a fall (18.5% as against 22.4%
in the first six months of 2005).
External economic conditions
The prices of Russia’s major export com-
modities3, especially energy products, continued
to grow in the first half of 2006, although slower
than in January-June 2005. The rising demand for
oil and insufficient production capacities to meet
it, and also the increased political tension in the
world due to the Iran nuclear issue and the situa-
tion in Nigeria and Iraq were the main factors of
world oil price growth. The situation on the world
oil market stabilised in May and early June after
the OPEC oil cartel decided to keep oil output quo-
tas unchanged at 28 million barrels per day.
The price of Brent, Dubai and WTI crude
grew 33.5% on average in January-June 2006 year
on year to $64.7 per barrel. The price of Urals crude
went up 34.7% in the first six months of 2006 to
$61.1 per barrel.
3 Average prices have been calculated on the basis of data provided daily by the following news agencies and exchanges: Reuters
for oil, Petroleum Argus for petroleum products (petrol, diesel fuel and fuel oil) and the London Metal Exchange for non-ferrous
metals (aluminium, copper and nickel). Average monthly prices of natural gas and ferrous metal price indices have been calculat-
ed on the basis of data provided by the World Bank, and other goods on the basis of data provided by the IMF.
11 2006 Q2
Inflation Dynamics
World oil prices went up in June on the re-
ports of reduced US oil and petroleum product
inventories (in the season of the highest demand
for these products) and increased oil consump-
tion in China. On June 30, 2006, the price of Urals
crude hit its record high of $68.6 per barrel.
Compared with December 2005, the price
of Urals crude increased 18.8% in June 2006
(42.5% in June 2005) to $64.0 per barrel. The price
of natural gas on the European market rose 10.7%
(18.0% a year earlier), premium petrol 42.7%
(46.1%), diesel fuel 22.2% (28.1%) and fuel oil
20.6% (68.1%). Non-ferrous metal prices grew
25.3% on average in June 2006 (2.3% in June
2005), whereas ferrous metal prices dropped
5.3% (in June 2005, they went up 10.5%).
According to Bank of Russia estimates, the
world price composite index adjusted for the struc-
ture of Russian exports of commodities that ac-
count for over 70% of their value equalled 1.15 in
June 2006 on December 2005 as against 1.26 in
June 2005. The prices of energy products in-
creased 17% on average (33% in June 2005) and
the prices of non-energy goods went up 6.2%
(7.4% in June 2005).
World food prices
4 demonstrated opposite
dynamics in the first half of 2006. Beef and poul-
try prices were largely observed to decline. The
prices of beef went down 3.5% and poultry 3.1%
while the prices of pork went up 21.9% in June
2006 on December 2005. In June 2005, beef prices
increased 2.5% and poultry 1.2% while pork prices
slipped 6.5%.
World sugar prices increase due to the per-
sisting shortage of sugar on world markets result-
ing from growth in sugar demand in many coun-
tries, especially the United States and China, and
limited possibilities for expanding sugar-growing
areas. Refined sugar prices also grew on reports
that the European Union had closed down 40%
of its sugar factories due to the reform of its sugar
sector, India had decided to ban the exports of
sugar produced from its sugarcane and sugar
stocks had fallen in China.
High price growth rates were registered in
December 2005, January and February 2006 when
raw sugar prices grew at a monthly rate of 10-16%
while refined sugar prices went up at a monthly
rate of 14-17%. However, market participants ex-
pect yields in sugarcane crops to grow 10-20% in
the 2006/2007 season year on year (sugarcane
yields are expected to rise 10.5% in Brazil and
22.7% in Thailand). As a result, raw sugar prices
fell in March, May and June, growth in refined
sugar prices slowed considerably in March-May
and refined sugar prices declined in June. Raw
sugar prices increased 12.4% and refined sugar
prices went up 39.6% in June 2006 on December
2005 (3.6% and 12.2%, respectively, in June
2005).
4 Average prices have been calculated on the basis of data provided daily by the London Commodity Exchange for raw and refined
sugar, average monthly prices of beef are based on data from the World Bank and the prices of pork and poultry are based on
data provided by the IMF.
2006 Q2
As the prices of Russia’s major export com-
modities grew considerably faster than import
prices, the terms of Russia’s trade with foreign
countries
5 were much better in the first six months
of 2006. However, growth in the terms of trade
index slightly decelerated in January-June 2006
year on year.
According to Bank of Russia estimates,
world prices of Russia’s major export commodi-
ties adjusted for their structure grew 30% on av-
erage in January-June 2006 year on year (36% in
January-June 2005). Russian exports grew in the
period under review as the prices of major energy
products increased and export volumes expanded.
Exports grew 31.2% in January-June 2006 to
$144.1 billion (in January-June 2005, exports in-
creased 36.4%). The value of exports expanded
largely due to the exportation of energy products.
Growth in imports decelerated in the first
six months of 2006. Imports grew 26.1% in Janu-
ary-June 2006 year on year (28.4% in January-
June 2005) to $69.5 billion. The growth in imports
was attributable to larger import volumes and
higher contract prices. The value of imports in-
creased mainly due to larger purchases of engi-
neering goods.
Demand
Domestic demand
Economic development parameters in the
first six months of 2006 were primarily determined
by the consumer and investor components of do-
mestic demand.
Real consumer spending increased by an
estimated 11.3% in January-June 2006 year on
year. The increase in consumer demand was at-
tributable to fast growth in household real dispos-
able money income, which rose 11.4% in January-
June 2006 (8.5% in the same period of 2005).
Retail trade turnover expanded 11.3% in the first
six months of 2006 year on year (12.2% in the
same period of 2005). In the structure of retail
trade turnover, the sales of non-food products
grew faster than the sales of food products. The
volume of paid services provided to the public
grew 6.6% (6.3%).
5 The ratio between export and import prices.
13 2006 Q2
Inflation Dynamics
Fixed capital investment grew 9.4% in Janu-
ary-June 2006 (8.9% in January-June 2005). In
2006 Q1, the largest funds were invested in the
development of transport and communications,
manufacturing industries, and also in the mining
sector (investments in these types of activity ac-
counted for 67.6% of total investment in the fixed
assets of large and medium-sized organisations).
Compared with the same period of 2005, the
share of transport and communications increased
from 21.9% to 25.7% and manufacturing indus-
tries from 19.9% to 21.4% in the structure of fixed
capital investment. At the same time, the share
of investment in the mining sector declined from
24.1% to 20.5%.
In January-June 2006, as in January-June
2005, the active part of fixed assets accounted for
more than a third of fixed capital investment. Con-
siderable investments in machinery and equip-
ment facilitated the technical retooling of fixed
assets, were a major factor of growth in labour
productivity and created conditions for price con-
trol.
Foreign demand
World economic growth continued in the
first half of 2006. According to estimates, GDP
rose 3.6% in the United States in January-June
2006 year on year (3.2% in January-June 2005),
2.2% in the eurozone (1.2%) and 10.9% in China
(9.9%). The growth of industrial output, employ-
ment, household real disposable money income
and domestic trade turnover in the United States
suggests the continued cyclical recovery of the US
economy. At the same time, a trend towards
slower housing construction was registered in the
United States in the first half of 2006. The growth
of the US economy slowed in 2006 Q2 quarter on
quarter.
The US trade deficit increased by $43.7 bil-
lion in January-June 2006 year on year as the value
of imports of goods grew faster than exports. The
US trade deficit widened largely due to different
rates of growth in the export and import of in-
dustrial primary goods and raw materials, espe-
cially due to accelerated growth in the imports of
crude oil, petroleum products and natural gas into
the United States in terms of value. The deficit of
the US merchandise trade with the member states
of the North American Free Trade Agreement
(Canada and Mexico), China and OPEC countries
widened considerably. The deficit of US trade with
China accounted for about a quarter of the United
States’ total trade deficit (the same ratio was reg-
istered in the first six months of 2005). In China,
growth in the export of goods slowed down, while
growth in imports accelerated in January-June
2006 year on year. Nevertheless, exports contin-
ued to grow faster than imports. China’s trade
surplus increased to $61.4 billion in January-June
2006 from $39.7 billion in January-June 2005.
US inflation stood at 3.1% in June 2006
compared with December 2005 (in June 2005, it
stood at 2.2%). The growth in energy prices and
core inflation
6 made roughly equal contributions
to the change in the general level of consumer
prices in the United States in the period under re-
view. Motor fuel prices increased 32.6% (15.1%
in June 2005 on December 2004). Growth in the
prices of energy products used in the housing and
public utility sector
7 decelerated to 3.3% (8% in
June 2005 on December 2004). Food prices rose
0.8% (1% in June 2005 on December 2004). Their
growth did not exert considerable influence on the
change in the general level of consumer prices in
the United States. US core inflation stood at 1.9%
in June 2006 on December 2005 (1.4% in June
6 Core inflation in the United States signifies growth in the prices of goods and services included in the consumer goods basket,
except foodstuffs and energy products.
7 Fuel oil, boiler fuel, coal, household gas, electricity.
2006 Q2
2005 on December 2004). The increase in hous-
ing charges, which grew 2.9% (2.1% in June 2005
on December 2004) traditionally made the big-
gest contribution to core inflation.
Eurozone inflation stood at 1.4% in June
2006 on December 2005 (1.2% in June 2005). The
growth in energy prices, which went up 7.2%
(7.5% in June 2005 on December 2004), was a
major inflationary factor. Motor fuel and lubricant
prices increased 9% (10.5% in June 2005 on De-
cember 2004) and the prices of energy products
used in the housing and public utility sector rose
5.1% (3.8%). Inflation increased due to growth
in the prices of foodstuffs, including beverages
and tobacco, which went up 1.7% (1.2% in June
2005 on December 2004), with vegetable and
fruit prices growing 5.1% (5%) and meat and dairy
product prices rising 1.1% (0.4%). Core inflation
in the eurozone
8 stood at 0.5% in June 2006 on
December 2005 (also 0.5% in June 2005).
Eurozone core inflation was relatively stable due
to a decline in communication fees, the prices of
clothing and footwear, and also the prices of
goods and services in the sphere of leisure and
entertainment. The increase in housing prices and
charges in the hotel and restaurant business made
the biggest contribution to core inflation in the
euro area.
As for other countries, which account for
substantial portions of Russia’s trade turnover,
inflation slowed down in June 2006 on Decem-
ber 2005 in Ukraine (to 2.9% from 6.4% in June
2005), Brazil (to 1.5% from 3.2%), Romania (to
2.7% from 4.2%), Belarus (to 3.1% from 4%),
Hungary (to 2.9% from 3.5%), Latvia (to 3.9%
from 4.4%), Iran (to 7.1% from 7.4%) and China
(to 0.1% from 0.2%). At the same time, inflation
increased considerably in Turkey (to 4.9% from
2.6% in June 2005), India (to 3.5% from 1.5%)
and Kazakhstan (to 4.8% from 3.5%). Consumer
prices in Japan rose 0.7% in June 2006 on Decem-
ber 2005 (they fell 0.4% in June 2005). Inflation
increased in Great Britain, Sweden, Switzerland,
Poland, the Czech Republic, Slovakia, Lithuania,
Estonia and Israel, and was unchanged in the Re-
public of Korea. The largest consumer price
growth in June 2006 on December 2005 was reg-
istered in Iran and the smallest consumer price in-
crease was observed in China.
The US Federal Reserve raised its bench-
mark short-term interbank interest rate (the
federal funds rate) four times in January-June
2006: from 4.25% to 4.5% in January, to 4.75%
in March, to 5% in May and to 5.25% in June.
From June 2004 to June 2006, the federal funds
rate was raised by 4.25 percentage points. The
European Central Bank raised its refinance rate
from 2% to 2.25% in December 2005, to 2.5% in
March and to 2.75% in May 2006.
LIBOR rates on US dollar-denominated
deposits with terms from one month to one year
increased by 0.8-0.9 percentage points in June
2006 on December 2005 and LIBOR rates on euro-
denominated deposits with similar maturities went
up by 0.5-0.6 percentage points
9. The yields on
US treasurys with maturities from two to ten years
rose by 0.6-0.7 percentage points. The yields of
similar eurozone securities also grew by 0.6-0.7
percentage points. LIBOR rates on US dollar-de-
nominated deposits with all terms and the yields
on US Federal Treasury bonds with all maturities
were higher in June 2006 than LIBOR rates on
euro-denominated deposits and the yields on
eurozone securities. The US federal funds rate has
been higher than the ECB’s refinance rate since
December 2004 (a difference of 2.25 percentage
points since August 9, 2006. The maximum dif-
8 Eurozone core inflation signifies growth in the prices of goods and services included in the consumer goods basket, except
foodstuffs, alcoholic beverages, tobacco and energy products.
9 Source here and below: Reuters news agency.
15 2006 Q2
Inflation Dynamics
ference for the period since the beginning of this
year and for the period since December 2004 was
2.5 percentage points).
In the first six months of 2006, the US dol-
lar depreciated against major international
reserve currencies on world financial markets
due to rising imbalances in US foreign trade and
interest rate increases in the eurozone and Japan.
The dollar weakened 6.8% against the euro, 5.6%
against the British pound and 3.2% against the
Japanese yen in June 2006 compared with Decem-
ber 2005. The dollar also depreciated against most
other currencies of importance for the Russian
economy, including its 0.9% decrease against the
Chinese yuan.
Supply
In January-June 2006, the macroeconomic
situation was characterised by the growth of pro-
duction in the key economic sectors. Output in the
key sectors of the economy increased 6.0% in the
first six months of 2006 (3.7% in the same period
of 2005).
The industrial output index equalled 104.4%
in the first half of 2006 (103.4% in January-June
2005). Industrial output increased faster in Janu-
ary-June 2006 year on year as industrial produc-
tion growth accelerated from 1.5% to 2.3% in the
mining sector and from 1.6% to 5.7% in the pro-
duction and distribution of electricity, gas and
water. Manufacturing industries made the biggest
contribution to the expansion of industrial output
in January-June 2006. However, the growth of
output in the manufacturing sector slowed from
4.7% in January-June 2005 to 4.5% in January-
June 2006.
In the manufacturing sector, output de-
clined considerably (by 8.7%) in January-June
2006 in the production of machinery and equip-
ment (in January-June 2005, it grew 8.7%).
Growth in the production of electric, electronic
and optical equipment decelerated from 22% to
5.5%. Output in all the key industries oriented to
final consumption expanded in January-June 2006
year on year. The production of textile and cloth-
ing, and also leather, leather goods and footwear
was observed to decrease in January-June 2005.
In January-June 2006, these industries registered
considerable growth rates, 10.8% and 12.3%, re-
spectively. Growth in the output of food products,
including beverages, and tobacco accelerated
from 2.1% in January-June 2005 to 5.2% in Janu-
ary-June 2006.
The output of meat and meat products in-
creased 5.4% in the first six months of 2006 year
on year, while fish and seafood production ex-
panded 0.4%. As a result, the growth in meat and
fish prices slowed down on the consumer goods
market. Granulated sugar output declined 11.9%
in January-June 2006 year on year and adversely
affected the dynamics of consumer prices.
Agricultural output expanded 1.4% in Janu-
ary-June 2006 year on year (0.5% in January-June
2005). According to preliminary data, farms of all
categories sowed 1.3% less grain crops for the
2006 harvest year on year, with wheat crops de-
clining 7.3%. At the same time, sunflower, sugar
beet and vegetable crops increased 10.8%, 23.7%
and 1.4%, respectively. There was an increase in
the output of major livestock products in January-
June 2006 (except milk production, which fell
0.3%).
Labour market
The number of people employed in the
economy continued to grow in the first half of
2006. The number of jobholders rose by an esti-
mated 0.7% in January-June 2006 (1.1% in Janu-
ary-June 2005). The production of goods and ser-
vices grew faster than job numbers, evidencing an
increase in labour productivity. Labour productiv-
ity rose by an estimated 5.5% in the first six
months of 2006 (4.3% in January-June 2005).
Therefore, the intensive factors of growth re-
mained important, containing price growth in the
economy.
Real wages increased faster than labour
productivity in the first half of 2006. The gap be-
tween growth in real wages and labour produc-
tivity widened in January-June 2006 year on year,
creating conditions for further price increases.
The number of jobless calculated according
to ILO methodology declined 0.3% in January-
June 2006 year on year (7.5% in January-June
2005). As in the same period of 2005, the total
number of unemployed accounted for an esti-
mated 7.8% of the economically active popula-
tion in January-June 2006.
17 2006 Q2
Quantitative and Qualitative Monetary Indicators
Quantitative and Qualitative Monetary Indicators
the end of June) as traders on the international
and Russian foreign exchange markets expected
the US Federal Reserve to halt raising interest rates
due to slower US economic growth.
In 2006 Q2, the average dollar/ruble rate fell
3.5% quarter on quarter to 27.20 rubles to the
dollar. The average dollar/ruble rate declined 1.1%
in April, 1.9% in May and 0.3% in June to 27.57,
27.06 and 26.98 rubles to the dollar, respectively.
The US currency depreciated 5.9% against the
ruble on average in the first six months of 2006.
On the domestic euro market, changes in
the euro/ruble rate followed the euro/dollar dy-
namics on international markets.
The euro/ruble nominal rate grew 1.7% in
April and 1.5% in May and fell 1.3% in June on the
domestic foreign exchange market. The average
euro/ruble rate also registered growth in April and
May (0.8% and 2.2%, respectively) but declined
0.9% in June. The average euro/dollar rate rose
1% in 2006 Q2 quarter on quarter and was un-
changed compared with December 2005.
The real effective rate of the ruble against
foreign currencies rose 1.8% in 2006 Q2 quarter
on quarter (4.7% in 2006 Q1). It was virtually un-
changed in April, declined 0.6% in May and in-
creased 1.4% in June. The ruble’s real effective rate
against foreign currencies grew 6.2% in the first
six months of 2006.
Exchange rate
Against the background of high world en-
ergy prices, exporters’ foreign currency earnings
flowed in large amounts into the domestic mar-
ket in 2006 Q2. The dollar/ruble and euro/ruble
rates were determined by the changes in the dol-
lar/euro rate on international markets. The Bank
of Russia remained a net purchaser of foreign cur-
rency on the domestic foreign exchange market
as it carried out operations to smooth the ruble/
dollar and ruble/euro rate fluctuations. The bi-
currency basket used by the Bank of Russia as an
operational benchmark of its exchange rate policy
was unchanged in the second quarter of 2006 (0.6
dollars and 0.4 euros).
The dollar/ruble nominal rate slipped 1.5%
in April and 1.2% in May. The US currency contin-
ued to depreciate at the beginning of the first ten-
day period of June and fell to 26.71 rubles to the
dollar on June 6. After that, the dollar’s nominal
rate gained 0.4% or 10 kopecks against the ruble
in the first half of June after the US Federal Re-
serve announced its intention to raise the federal
funds rate at the end of the month. In the second
half of June, the dollar/ruble rate fluctuated
within the range of 26.97-27.08 rubles to the dol-
lar but declined to 26.94 rubles to the dollar as of
July 1. The dollar/ruble rate fell (even despite the
increase in the federal funds rate to 5.25% p.a. at
2006 Q2
The inflow of large amounts of exporters’
foreign currency earnings into the domestic mar-
ket in April-June 2006 contributed to growth in
Russia’s international reserves. They grew by $44.7
billion, or 22%, in the period under review (by
$23.6 billion, or 13%, in the first quarter of 2006).
Since the beginning of 2006, Russia’s international
reserves had increased by $68.3 billion, or 37%,
to $250.6 billion as of July 1, 2006.
Interest rates
In the first six months of 2006, the Bank of
Russia took measures to narrow the band of in-
terest rates on its operations. The lower limit of
the Bank of Russia interest rate band formed
by the rate on standard “tom-next” deposit op-
erations was raised from 1% to 1.5% p.a. in 2006
Q2 (in April) and from 1.5% to 2% p.a. in August.
The upper limit (the refinance rate and the over-
night credit and currency swap rates) was lowered
in June from 12% to 11.5% p.a.
Average weighted interest rates ranged
from 2.44% to 3% p.a. at four-week deposit auc-
tions in 2006 Q2 and were higher than in 2006
Q1. At the same time, the range of their fluctua-
tions at three-month deposit auctions narrowed
in 2006 Q2 quarter on quarter to 4.43-4.85% p.a.
Average weighted yields at auctions held by the
Bank of Russia in 2006 Q2 to place its OBR bonds
ranged from 4.53% to 5.20% p.a. This range of
fluctuations was roughly the same as in 2006 Q1.
The average interest rate on repo operations, the
principal market instrument used in providing li-
quidity, decreased insignificantly to 6.10%.
The MIACR rates on overnight interbank
ruble credits remained within the Bank of Russia
interest rate band in 2006 Q2. The range of fluc-
tuations of the MIACR on overnight ruble-de-
nominated credit narrowed from 0.78-8.86% p.a.
in 2006 Q1 to 0.93-7.40% p.a. in 2006 Q2.
Opposite trends were registered in changes
in interest rates on banks’ operations with non-
financial enterprises and households in 2006 Q2.
Interest rates declined in the segment of house-
hold ruble deposits and moderately increased in
the segment of credits to non-financial enter-
prises.
The average interest rate on credits ex-
tended to non-financial enterprises for all terms
19 2006 Q2
Quantitative and Qualitative Monetary Indicators
increased by 0.9 percentage points in April month
on month to 11.1% p.a. It was unchanged in May
and dropped by 0.4 percentage points in June. The
second-quarter average grew 0.5% quarter on
quarter to 11.0% p.a. The average interest rate on
credits extended to non-financial enterprises for
all terms increased in 2006 Q2 as interest rates on
credits for a term of over three years went up by
1.1 percentage points and the share of these cred-
its in total credit to non-financial enterprises grew
considerably. Interest rates on shorter-dated cred-
its declined moderately in 2006 Q2.
The growth in the demand for credits from
households, the increase in the cost of consumer
lending and the expansion of the group of bor-
rowers enable banks to keep interest rates on
credits to individuals higher than on credits to en-
terprises. However, increasing competition among
creditors compel them to cut the cost of consumer
loans. The average quarterly interest rate on cred-
its to households for all terms decreased by 2.1
percentage points in 2006 Q2 quarter on quarter
to 17.4% p.a. The largest decrease was registered
in the sector of credits with a maturity of over one
year. Interest rates on credits with other maturi-
ties declined more slowly.
The average interest rate on household time
deposits was 6.2% p.a. in 2006 Q2 or 1.7 percent-
age points lower than in 2006 Q1. As in the previ-
ous quarter, deposits with a maturity of six to 12
months registered the highest interest rates in
2006 Q2. The average interest rate on these de-
posits fell only by 0.5 percentage points in April-
June 2006 quarter on quarter to 9.4% p.a.
The yield curve on banks’ lending operations
had a rising slope in 2006 Q2, and registered an
insignificant negative incline in the sector of lend-
ing operations with a maturity of one to three
years. The yield curve was almost unchanged as a
whole, suggesting the market operators’ persist-
ing short- and medium-term inflationary expec-
tations.
A weak yield uptrend prevailed in all the seg-
ments of the ruble-denominated government
bond market in 2006 Q2. The effective indicator
of the OFZ market portfolio increased by 0.10 per-
2006 Q2
centage points at the end of 2006 Q2 quarter on
quarter to 6.91% p.a. The average quarterly ef-
fective indicator of the OFZ market portfolio grew
by 0.10 percentage points to 6.91% p.a.
The government bond yield curve retained
its normal shape in the second quarter of 2006. A
slight increase in yields in the period under review
caused the curve to move upwards a little. The yield
curve slope continued to decrease due to some
growth in the yields on short- and medium-term
government bonds. The yield curve in the sector
of government bonds with a maturity of over 13
years remained flat as there were few instruments
with this maturity and the risks of investment in
such long-dated papers could not be assessed ac-
curately. Investors’ assessments of the reliability
and liquidity of ruble-denominated government
bonds for all terms were unchanged.
As before, the prices of most ruble-denomi-
nated instruments changed moderately on the fi-
nancial market in 2006 Q2. The interest rate struc-
ture by term of instrument remained balanced
enough. The yield curves of key financial instru-
ments had a normal shape and the yield curve
slope changed insignificantly, suggesting that
Russian financial market players did not expect
any considerable changes in short- and medium-
term inflation rates.
Money
In 2006 Q2, annualised M2 growth (month
on month of previous year) accelerated from
37.9% as of April 1, 2006, to 43.9% as of July 1,
2006. The M2 growth stood at 15% in 2006 Q2
(10.1% in 2005 Q2) and was considerably faster
than in the previous quarter (2%) due to seasonal
factors. In July 2006, the M2 growth rates were
not lower than in July 2005, according to esti-
mates. Therefore, the money supply growth rates
remain high, even despite the adjusted target for
growth in the demand for money this year, and
continue to exert monetary pressure on inflation.
The current estimates of core inflation in-
fluenced by the monetary dynamics indicate that
its rate may come close to the core inflation tar-
get by the end of the year, given that the
annualised money supply growth eventually re-
gains its downward path.
21 2006 Q2
Quantitative and Qualitative Monetary Indicators
The gap between M2 and GDP growth
rates1, which began to widen in the second half
of 2005, continued to increase in 2006 Q2. The
gap between the growth rates of GDP and the
broader monetary aggregate M2X comprising
economic agents’ foreign currency non-cash
funds did not increase in 2006 Q2 due to the
aggregate’s slower growth. The gap between the
rates of growth of the economy (in terms of GDP)
and money supply (in terms of M2 and M2X) was
wider at the end of 2006 Q2 than at the end of
2005 Q2. Money velocity dynamics are essential
to assess the influence of this gap on inflation. In
2006 Q2, money velocity calculated by M2 fell
2.6% (1.3% in the same period of 2005), retain-
ing its downward trend observed since the sec-
ond half of 2005. Therefore, money velocity de-
clined more intensively in the first half of 2006
under the influence of money supply structural
changes and a considerable fall in the demand for
foreign currency, reflecting increased demand for
the domestic currency and easing potential infla-
tionary implications of monetary growth.
The growth rates of the aggregate
Money in the monetary survey definition ,
which is similar to the M1 aggregate and comprises
the most liquid transactional components of
money supply, exceeded by two times the growth
rates of less liquid savings components of money
supply (Quasi-money aggregate) in April-June
2006. The Money aggregate annualised growth
(relative to the corresponding date of previous
year) increased considerably: from 34.8% as of
April 1, 2006, to 42.5% as of July 1, 2006. This in-
crease was attributable to the expansion of the
aggregate’s cash component and its non-cash part
comprising funds in accounts and demand depos-
its (their growth was faster in April-June 2006
than growth in cash). The annualised cash growth
stood at 35.3% as of July 1, 2006, and exceeded
last year’s figure almost by 6 percentage points.
The annualised growth of the M1 non-cash com-
ponent equalled 50.5% as of July 1, 2006, and
exceeded last year’s figure by 20.7 percentage
points.
The M1 non-cash component is comprised
by about 80% of non-financial enterprise sector
funds and its increase reflects economic agents’
rising demand for money to conduct transactions
and service the payment turnover. The faster
growth in non-cash transaction money creates less
inflationary pressure compared with cash because
cash has big potential and longer lag of impact on
inflationary processes.
Following the seasonal trends of the past
few years, cash growth was faster in 2006 Q2
than in 2006 Q1. As household real disposable
money income increased more rapidly in the first
half of 2006 year on year, growth in the M0 mon-
etary aggregate accelerated from 7.5% in Janu-
ary-June 2005 to 11.2% in January-June 2006.
1 The gap characterises the part of monetary growth that exceeds the amount necessary to finance the increased volume of
transactions. The expansion of the gap may testify to the inflationary pressure of money supply growth on price dynamics.
2006 Q2
The M0 dynamics could have been especially
affected by the fluctuations of household demand
for foreign currency cash. As was the case in the
first half of 2003 and at the beginning of 2004,
the ruble’s relatively stable appreciation against
the dollar in the first few months of the year was
followed by a large-scale contraction in household
demand for US dollar cash. As a result, the de-
mand for foreign currency cash fell considerably
in 2006 Q2 as a whole. In 2006 Q1, household
operations with foreign currency cash registered
a surplus, which held back M0 growth, whereas
in 2006 Q2 the balance of these operations was
negative and could have contributed to the in-
crease in cash rubles. As a result, after a steady
decline in the rates of cash growth in the moving
12-month period observed since November 2005,
these rates increased in May-June 2006 to 35.3%
as of July 1, 2006 (29.4% as of July 1, 2005).
At the same time, cash growth in the mov-
ing 12-month period was slower at the end of 2006
Q2 than M2 growth. The share of cash in the M2
structure declined from 33.5% as of July 1, 2005,
to 31.5% as of July 1, 2006. The above trends in
cash dynamics were positive for structural changes
in ruble supply and had little effect on inflation in
the first six months of 2006. At the same time,
the resumption of the trend towards slower M0
growth in the moving 12-month period is essen-
tial for the government to achieve its inflation tar-
gets for 2006 and next year.
Compared with the previous quarter, the
aggregate Quasi-money increased almost 50%
slower than the aggregate Money in 2006 Q2. The
aggregate Quasi-money comprises less liquid
components of money supply used by economic
agents as savings. In April-June 2006, it grew
8.2%, while its annualised growth rates decreased
to 33.2% as of July 1, 2006, compared with 34%
as of April 1, 2006, and 35.6% as of July 1, 2005.
The increase in the aggregate Quasi-money
in April-June 2006 was largely attributable to
growth in time deposits representing its ruble
component . In 2006 Q2, time deposits grew
12.8%, while their annualised growth accelerated
by more than 3 percentage points to 46.4%.
Growth in ruble time deposits also accelerated year
on year (41.5% as of July 1, 2005). The persisting
fast growth in ruble-denominated time deposits
23 2006 Q2
Quantitative and Qualitative Monetary Indicators
is important from the viewpoint of mitigating the
inflationary consequences of money supply
growth.
Growth in the foreign currency compo-
nent of Quasi-money (2.4%) was slower in 2006
Q2 than in the previous quarter and 2005 Q2.
Annualised growth in foreign currency-denomi-
nated deposits (relative to the corresponding
date of previous year) decelerated to 19% as of
July 1, 2006, from 28.9% as of July 1, 2005, and
was considerably slower than growth in ruble-de-
nominated time deposits.
The monetary aggregate dynamics were
largely determined by the flow of ruble and for-
eign currency funds resulting from the fluctua-
tions of demand for the national and foreign cur-
rency. As the demand for foreign exchange fell
considerably in 2006 Q2, annualised growth in the
ruble monetary aggregates accelerated more sig-
nificantly than growth in the monetary aggregate
M2X comprising foreign currency assets (money
supply plus foreign currency deposits) and the
broader M2Y aggregate comprising foreign cur-
rency cash. At the same time, the rates of growth
in all the monetary aggregates at the end of 2006
Q2 were higher than at the end of 2005 Q2.
Annualised growth in the M2X aggregate com-
prising non-financial agents’ non-cash foreign
currency (date on corresponding date of previous
year) equalled 38% as of July 1, 2006, as against
32.4% a year earlier. Annualised growth in the
M2Y monetary aggregate accelerated by almost
2 percentage points in April-June 2006. At the
same time, while the broader aggregate demon-
strated a long-term upward trend, its growth ac-
celeration (from 26.8% as of July 1, 2005, to
30.8% as of July 1, 2006) was less considerable
compared with the other aggregates.
The ratio of dollarisation, that is, the share
of the foreign currency component of the money
supply in the monetary survey definition (M2X),
decreased by 1.6 percentage points in January-
June 2006, from 16.3% to 14.7% (by 0.5 percent-
age points in January-June 2005). At the same
time, the ruble component of Quasi-money con-
tinued to predominate in the M2X structure, ac-
counting for 31.4% as of July 1, 2006, as against
29.6% a year earlier.
The development of the process of the Rus-
sian economy’s de-dollarisation is also
characterised by changes in the M2Y aggregate
structure. Thus, the share of the foreign currency
component of this notional broad aggregate fell
in 2006 Q2 due to a contraction in the share of
foreign currency deposits and the share of for-
eign currency cash. Moreover, the contraction in
the share of foreign currency cash was more con-
siderable. In April-June 2005, the aggregate reg-
istered similar, although less intensive dynamics
of its non-cash and cash components. The share
of all foreign currency funds in the M2Y broad
aggregate slipped by 7 percentage points in the
period since July 1, 2005.
In 2006 Q2, the growth in the banking
sector’s claims on non-financial enterprises
and households (almost 670 billion rubles, or an
2006 Q2
annualised 44.3% as of July 1, 2006) considerably
exceeded the figure registered in the second quar-
ter of 2005 and was faster quarter on quarter par-
tially due to seasonal trends. Therefore, the role
of credit to non-financial enterprises and house-
holds as a source of aggregate money expansion
increased significantly in 2006 Q2. However, the
growth in the banking sector’s net foreign assets,
which exceeded the indicators of the previous
quarter and the second quarter of 2005, remained
the main source of money supply expansion.
The monetary base (broad definition) in-
creased 20.8% in 2006 Q2 (2.3% in 2005 Q2). The
share of credit institutions’ funds in correspondent
accounts with the Bank of Russia grew from 11.8%
to 13.1% in April-June 2006 (it fell from 14.3% to
12% in the same period of 2005). The share of
credit institutions’ funds absorbed by the Bank of
Russia by taking banks’ funds on deposit and con-
ducting operations with Bank of Russia bonds
(OBR) rose from 5.9% to 8.3% of the monetary
base in 2006 Q2 (it declined from 9.4% to 5.5%
in 2005 Q2) and from 12.2% to 14.1% taking into
account the credit institutions’ required reserves
(in 2005 Q2, it dropped from 15.3% to 11.5%).
In August 2006, the Bank of Russia took a
decision to raise from October 1, 2006, the re-
quired reserve ratio for Russian banks’ debt obli-
gations to non-resident banks in rubles and for-
eign currency from 2% to 3.5% to restrain aggre-
gate money supply growth and limit foreign bor-
rowings.
The large-scale increase in the general gov-
ernment deposits, caused by the expansion of the
Stabilisation Fund, had a serious restraining effect
on money supply growth in the first six months of
2006. World oil prices remained high in January-
June 2006 and led to a considerable increase in
the Stabilisation Fund, which totalled 2,066.8 bil-
lion rubles as of July 1, 2006. However, after the
cut-off price of oil was raised from $20 to $27 per
barrel, payments into the Stabilisation Fund de-
clined in February, despite growing world oil prices.
In the subsequent months, these contributions
continued to grow but failed to reach the level reg-
istered at the end of the previous year. If the cut-
off price had remained unchanged, the
Stabilisation Fund could have accrued 20% more
funds in February-June 2006, which suggests its
reduced absorption potential.
25 2006 Q2
Statistical Addendum
Statistical Addendum
Consumer prices by group of goods and services
(month on month, %)
Monthly inflation Core inflation Food price growth
Growth in food
prices net of
vegetable prices
Vegetable and
fruit price growth
Non-food price
growth
Service price
growth
January 1.8 0.9 1.6 1.3 5.5 0.5 4.1
February 1.0 0.8 1.1 1.1 1.5 0.4 1.6
March 0.8 0.7 1.1 0.9 2.8 0.4 0.6
April 1.0 0.8 0.8 1.0 -0.6 0.6 2.0
May 0.7 0.6 0.4 0.5 -0.7 0.8 1.4
June 0.8 0.5 0.8 0.4 4.8 0.7 0.9
July 0.9 0.8 1.0 1.0 1.5 0.6 1.3
August 0.4 0.7 0.1 0.8 -6.3 0.5 1.0
September 0.4 0.9 0.0 0.9 -9.0 0.9 0.6
October 1.1 1.3 1.4 1.7 -2.7 0.7 1.2
November 1.1 1.1 1.5 1.5 2.2 0.7 0.8
December 1.1 1.0 1.7 1.4 5.4 0.4 1.0
Full year (December on
December) 11.7 10.5 12.3 13.1 3.3 7.4 17.7
January 2.6 0.9 1.4 1.1 5.1 0.4 8.8
February 1.2 0.7 1.4 0.9 6.1 0.4 2.2
March 1.3 0.8 2.1 1.1 11.2 0.4 1.2
April 1.1 0.9 1.7 1.3 5.4 0.5 0.8
May 0.8 0.6 1.1 0.7 4.1 0.4 0.8
June 0.6 0.5 0.7 0.4 3.3 0.3 0.9
July 0.5 0.5 0.3 0.5 -1.8 0.4 0.9
August -0.1 0.5 -1.0 0.5 -12.9 0.5 0.8
September 0.3 0.8 -0.7 0.6 -11.6 1.1 0.9
October 0.6 0.7 0.4 0.6 -2.4 0.7 0.7
November 0.7 0.6 0.9 0.6 4.5 0.6 0.6
December 0.8 0.6 1.1 0.6 5.6 0.5 0.8
Full year (December on
December) 10.9 8.3 9.6 9.1 14.3 6.4 21.0
January 2.4 0.8 2.0 1.0 11.3 0.4 6.2
February 1.7 1.2 3.0 1.9 12.6 0.5 1.0
March 0.8 0.7 1.2 0.9 3.2 0.4 0.7
April 0.4 0.4 0.3 0.3 -0.3 0.3 0.6
May 0.5 0.4 0.5 0.2 2.6 0.4 0.6
June 0.3 0.3 0.0 0.1 -0.6 0.3 0.7
2006 Q2
Consumer prices by group of goods and services
(since start of year on accrual basis, %)
Monthly inflation Core inflation Food price growth
Growth in food
prices net of
vegetable prices
Vegetable and
fruit price growth
Non-food price
growth
Service price
growth
January 1.8 0.9 1.6 1.3 5.5 0.5 4.1
February 2.8 1.7 2.8 2.3 7.1 0.9 5.8
March 3.5 2.4 3.8 3.2 10.1 1.4 6.4
April 4.6 3.2 4.7 4.2 9.5 2.0 8.5
May 5.3 3.8 5.2 4.8 8.7 2.8 10.0
June 6.1 4.3 6.0 5.2 13.9 3.4 11.0
July 7.1 5.1 7.1 6.2 15.6 4.0 12.5
August 7.6 5.8 7.2 7.1 8.3 4.6 13.6
September 8.0 6.8 7.2 8.0 -1.4 5.5 14.3
October 9.3 8.1 8.7 9.9 -4.0 6.3 15.7
November 10.5 9.3 10.4 11.5 -1.9 7.0 16.6
December 11.7 10.5 12.3 13.1 3.3 7.4 17.7
January 2.6 0.9 1.4 1.1 5.1 0.4 8.8
February 3.9 1.7 2.8 2.0 11.5 0.7 11.2
March 5.3 2.4 4.9 3.1 24.0 1.1 12.6
April 6.5 3.3 6.7 4.4 30.8 1.6 13.5
May 7.3 4.0 7.9 5.1 36.1 2.1 14.4
June 8.0 4.4 8.6 5.5 40.6 2.4 15.4
July 8.5 5.0 8.9 6.1 38.0 2.8 16.5
August 8.3 5.5 7.8 6.6 20.2 3.4 17.4
September 8.6 6.3 7.1 7.2 6.2 4.5 18.5
October 9.2 7.1 7.5 7.8 3.6 5.2 19.3
November 10.0 7.7 8.4 8.4 8.3 5.9 20.0
December 10.9 8.3 9.6 9.1 14.3 6.4 21.0
January 2.4 0.8 2.0 1.0 11.3 0.4 6.2
February 4.1 2.0 5.0 2.9 25.3 0.9 7.2
March 5.0 2.8 6.2 3.9 29.3 1.3 8.0
April 5.4 3.2 6.5 4.2 28.9 1.6 8.6
May 5.9 3.6 7.0 4.4 32.3 2.0 9.3
June 6.2 3.9 7.0 4.5 31.5 2.3 10.0
27 2006 Q2
Statistical Addendum
Consumer prices by group of goods and services
(month on month of previous year, %)
Inflation over
period Core inflation* Food price
growth*
Growth in food
prices net of
vegetable prices*
Vegetable and
fruit price growth
Non-food price
growth*
Service price
growth*
January 11.3 11.0 9.2 11.7 -10.7 8.6 21.9
February 10.6 10.8 9.2 12.0 -12.9 8.0 18.9
March 10.3 10.8 9.2 12.2 -13.8 7.6 17.5
April 10.2 11.0 9.1 12.7 -17.8 7.6 17.8
May 10.2 11.0 8.9 12.9 -20.4 7.8 17.7
June 10.1 10.9 8.8 12.6 -18.4 7.9 17.4
July 10.4 11.0 9.5 12.9 -15.7 8.0 16.7
August 11.3 10.9 11.1 12.9 -4.6 8.0 17.0
September 11.4 10.7 11.3 12.7 -2.2 8.1 16.8
October 11.5 10.5 11.7 12.7 0.9 7.8 17.3
November 11.7 10.4 12.0 12.9 2.0 7.6 17.7
December 11.7 10.5 12.3 13.1 3.3 7.4 17.7
January 12.7 10.4 12.1 12.9 3.0 7.3 23.1
February 13.0 10.4 12.4 12.6 7.6 7.2 23.8
March 13.6 10.5 13.5 12.9 16.4 7.1 24.6
April 13.8 10.6 14.5 13.2 23.4 7.0 23.1
May 13.8 10.6 15.2 13.3 29.3 6.6 22.4
June 13.7 10.6 15.1 13.4 27.5 6.3 22.4
July 13.2 10.3 14.2 12.9 23.4 6.2 21.9
August 12.5 10.1 12.9 12.5 14.7 6.1 21.6
September 12.3 10.0 12.1 12.1 11.3 6.3 22.0
October 11.7 9.4 11.0 10.9 11.6 6.3 21.4
November 11.3 8.9 10.3 9.9 14.1 6.3 21.2
December 10.9 8.3 9.6 9.1 14.3 6.4 21.0
January 10.7 8.2 10.2 9.1 21.1 6.5 18.1
February 11.2 8.7 11.9 10.1 28.4 6.6 16.7
March 10.6 8.7 10.9 10.0 19.2 6.7 16.1
April 9.8 8.2 9.4 9.0 12.7 6.4 15.9
May 9.4 7.9 8.7 8.5 11.1 6.4 15.7
June 9.0 7.8 8.0 8.1 7.0 6.4 15.4
* Bank of Russia estimate.
2006 Q2
Inflation growth structure (percentage points)
Inflation growth over period since start of year due
to price changes by group of goods and services
Foodstuffs* Non-food
products Paid services Vegetables and
fruit
Inflation over
period, % Core inflation Non-core
inflation**
January 0.6 0.2 0.8 0.2 1.8 0.8 1.0
February 1.1 0.3 1.1 0.3 2.8 1.4 1.4
March 1.5 0.4 1.2 0.4 3.5 2.0 1.6
April 2.0 0.6 1.5 0.4 4.6 2.6 1.9
May 2.2 0.8 1.8 0.4 5.3 3.1 2.2
June 2.4 1.0 2.0 0.6 6.1 3.5 2.6
July 2.9 1.2 2.3 0.7 7.1 4.2 2.9
August 3.3 1.4 2.5 0.4 7.6 4.7 2.8
September 3.8 1.7 2.6 -0.1 8.0 5.5 2.5
October 4.6 1.9 2.9 -0.2 9.3 6.6 2.7
November 5.4 2.1 3.0 -0.1 10.5 7.6 2.9
December 6.1 2.3 3.2 0.1 11.7 8.5 3.3
January 0.4 0.1 1.8 0.2 2.6 0.7 1.9
February 0.8 0.2 2.3 0.5 3.9 1.3 2.6
March 1.3 0.4 2.6 1.0 5.3 1.9 3.3
April 1.9 0.5 2.8 1.3 6.5 2.7 3.8
May 2.1 0.7 3.0 1.5 7.3 3.1 4.1
June 2.3 0.8 3.2 1.7 8.0 3.5 4.5
July 2.5 0.9 3.4 1.6 8.5 3.9 4.5
August 2.8 1.1 3.6 0.8 8.3 4.4 4.0
September 3.0 1.5 3.9 0.3 8.6 5.0 3.6
October 3.3 1.7 4.0 0.1 9.2 5.6 3.6
November 3.6 1.9 4.2 0.3 10.0 6.1 3.9
December 3.8 2.1 4.4 0.6 10.9 6.6 4.3
January 0.4 0.2 1.5 0.4 2.4 0.6 1.8
February 1.1 0.3 1.7 1.0 4.1 1.5 2.6
March 1.5 0.5 1.9 1.2 5.0 2.1 2.9
April 1.6 0.6 2.0 1.1 5.4 2.5 2.9
May 1.7 0.7 2.2 1.3 5.9 2.7 3.1
June 1.8 0.8 2.4 1.2 6.2 3.0 3.2
* Excluding vegetables and fruit.
** Growth in prices of goods and paid services not included in calculation of core consumer price index.
29 2006 Q2
Statistical Addendum
Monthly inflation growth due to price changes
by group of goods and services
Foodstuffs* Non-food
products Paid services Vegetables and
fruit
Inflation over
period, % Core inflation Non-core
inflation**
January 0.6 0.2 0.8 0.2 1.8 0.8 1.0
February 0.5 0.1 0.3 0.1 1.0 0.6 0.4
March 0.4 0.1 0.1 0.1 0.8 0.6 0.2
April 0.4 0.2 0.4 0.0 1.0 0.6 0.3
May 0.2 0.2 0.3 0.0 0.7 0.5 0.2
June 0.2 0.2 0.2 0.2 0.8 0.4 0.4
July 0.4 0.2 0.3 0.1 0.9 0.6 0.3
August 0.4 0.2 0.2 -0.3 0.4 0.5 -0.1
September 0.4 0.3 0.1 -0.4 0.4 0.7 -0.3
October 0.8 0.2 0.2 -0.1 1.1 1.0 0.2
November 0.7 0.2 0.2 0.1 1.1 0.9 0.2
December 0.6 0.1 0.2 0.2 1.1 0.8 0.3
January 0.4 0.1 1.8 0.2 2.6 0.7 1.9
February 0.4 0.1 0.5 0.3 1.2 0.6 0.7
March 0.5 0.1 0.3 0.5 1.3 0.6 0.7
April 0.5 0.2 0.2 0.3 1.1 0.7 0.4
May 0.3 0.1 0.2 0.2 0.8 0.5 0.3
June 0.2 0.1 0.2 0.2 0.6 0.4 0.3
July 0.2 0.1 0.2 -0.1 0.5 0.4 0.1
August 0.2 0.2 0.2 -0.6 -0.1 0.4 -0.5
September 0.2 0.4 0.2 -0.6 0.3 0.6 -0.4
October 0.3 0.2 0.2 -0.1 0.6 0.5 0.0
November 0.2 0.2 0.1 0.2 0.7 0.5 0.3
December 0.3 0.1 0.2 0.2 0.8 0.4 0.4
January 0.4 0.2 1.5 0.4 2.4 0.6 1.8
February 0.7 0.2 0.2 0.5 1.7 0.9 0.7
March 0.4 0.1 0.2 0.2 0.8 0.6 0.3
April 0.1 0.1 0.1 0.0 0.4 0.3 0.0
May 0.1 0.1 0.1 0.1 0.5 0.3 0.2
June 0.0 0.1 0.2 0.0 0.3 0.2 0.1
* Excluding vegetables and fruit.
** Growth in prices of goods and paid services not included in calculation of core consumer price index.
2006 Q2
Contribution to Inflation Growth (%)
Contribution to inflation growth over period since start
of year by group of goods and services
Foodstuffs* Non-food products Paid services Vegetables and fruit Core inflation Non-core inflation**
January 33.8 8.6 43.5 14.0 43.2 56.8
February 40.0 10.2 38.3 11.5 50.0 50.0
March 42.9 11.7 32.8 12.7 55.3 44.7
April 43.5 13.3 34.0 9.2 57.5 42.5
May 42.4 15.9 34.4 7.3 58.5 41.5
June 39.8 17.2 32.9 10.1 57.2 42.8
July 40.9 17.3 32.1 9.8 58.8 41.2
August 43.8 18.4 32.8 4.9 62.6 37.4
September 47.0 21.1 32.7 -0.8 68.4 31.6
October 50.2 20.8 31.0 -1.9 70.9 29.1
November 51.5 20.4 28.9 -0.8 72.0 28.0
December 52.1 19.2 27.5 1.2 72.0 28.0
January 17.0 4.8 70.2 8.0 27.1 72.9
February 21.2 6.2 60.4 12.1 33.4 66.6
March 24.5 6.8 50.0 18.7 36.7 63.3
April 28.6 8.1 43.8 19.5 41.1 58.9
May 29.3 9.2 41.2 20.2 43.1 56.9
June 29.0 9.8 40.5 20.8 44.1 55.9
July 30.1 10.9 40.7 18.3 46.5 53.5
August 33.2 13.2 43.6 9.9 52.3 47.7
September 35.1 17.1 44.9 3.0 58.3 41.7
October 35.9 18.6 43.9 1.6 60.9 39.1
November 35.6 19.2 41.8 3.4 61.1 38.9
December 35.2 19.2 40.3 5.4 60.5 39.5
January 16.0 6.1 59.5 18.3 24.5 75.5
February 27.2 7.7 40.9 24.1 37.2 62.8
March 30.1 9.1 37.6 23.2 42.4 57.6
April 30.5 10.3 37.9 21.3 45.7 54.3
May 29.3 11.8 37.2 21.8 46.7 53.3
June 28.6 12.9 38.3 20.2 48.4 51.6
* Excluding vegetables and fruit.
** Growth in prices of goods and paid services not included in calculation of core consumer price index.
31 2006 Q2
Statistical Addendum
Contribution to monthly inflation growth
by group of goods and services
Foodstuffs* Non-food products Paid services Vegetables and fruit Core inflation Non-core inflation**
January 33.8 8.6 43.5 14.0 43.2 56.8
February 50.7 13.1 29.1 7.1 61.8 38.2
March 52.8 17.0 13.3 16.9 74.2 25.8
April 45.7 19.0 38.2 -2.9 65.1 34.9
May 35.7 32.6 36.6 -4.9 64.9 35.1
June 22.1 25.8 23.1 29.1 48.2 51.8
July 47.5 17.6 27.3 7.5 68.1 31.9
August 89.6 37.7 44.9 -72.2 122.3 -22.3
September 100.3 67.0 30.2 -97.5 164.9 -64.9
October 70.5 18.9 20.3 -9.7 86.8 13.2
November 60.7 18.0 13.8 7.5 79.4 20.6
December 55.8 9.0 15.5 19.7 71.7 28.3
January 17.0 4.8 70.2 8.0 27.1 72.9
February 30.0 9.2 40.0 20.8 46.5 53.5
March 33.6 8.4 20.9 37.0 46.1 53.9
April 46.7 14.1 15.8 23.4 60.9 39.1
May 34.9 18.4 20.6 26.1 60.1 39.9
June 25.7 15.5 32.1 26.6 54.6 45.4
July 48.4 29.6 43.6 -21.6 86.0 14.0
August estimate can't be made for negative value
September 92.7 141.5 83.9 -218.1 243.9 -143.9
October 47.2 40.9 29.7 -17.8 96.4 3.6
November 31.6 26.1 18.2 24.1 63.1 36.9
December 31.0 18.8 22.1 28.1 53.5 46.5
January 16.0 6.1 59.5 18.3 24.5 75.5
February 43.4 10.0 14.0 32.6 55.8 44.2
March 43.9 15.8 21.6 18.7 67.5 32.5
April 35.8 27.0 41.3 -4.2 90.9 9.1
May 16.1 27.6 29.9 26.4 57.3 42.7
June 15.3 34.9 59.7 -10.0 81.6 18.4
* Excluding vegetables and fruit.
** Growth in prices of goods and paid services not included in calculation of core consumer price index.
2006 Q2
Major monetary indicators in 2005-2006
2005 2006
1.01 1.04 1.05 1.06 1.07 1.10 1.01 1.04 1.05 1.06 1.07
Cash (M0), billion rubles 1,534.8 1,481.7 1,565.8 1,582.3 1,650.7 1,740.7 2,009.2 1,928.8 2,027.8 2,096.9 2,233.4
monthly rates of growth, % 15.2 2.6 5.7 1.1 4.3 2.2 13.8 2.0 5.1 3.4 6.5
rates of growth since start of year, % -3.5 2.0 3.1 7.6 13.4 30.9 -4.0 0.9 4.4 11.2
share in M2 structure, % 35.2 33.1 34.1 33.7 33.5 32.9 33.2 31.3 31.9 31.3 31.5
Non-cash funds (M2-M0), billion rubles 2,828.5 2,992.9 3,021.0 3,106.4 3,276.7 3,552.1 4,036.3 4,240.6 4,332.3 4,596.2 4,858.9
monthly rates of growth, % 8.5 4.4 0.9 2.8 5.5 3.5 10.0 5.2 2.2 6.1 5.7
rates of growth since start of year, % 5.8 6.8 9.8 15.8 25.6 42.7 5.1 7.3 13.9 20.4
M2 monetary aggregate, billion rubles 4,363.3 4,474.6 4,586.8 4,688.6 4,927.4 5,292.8 6,045.6 6,169.4 6,360.1 6,693.1 7,092.3
monthly rates of growth, % 10.7 3.8 2.5 2.2 5.1 3.1 11.2 4.2 3.1 5.2 6.0
rates of growth since start of year, % 2.6 5.1 7.5 12.9 21.3 38.6 2.0 5.2 10.7 17.3
rates of growth (month on month of previous year, %) 35.8 30.8 31.7 33.0 33.6 42.0 38.6 37.9 38.7 42.8 43.9
Foreign currency deposits, billion rubles 935.1 1,024.9 1,007.7 1,054.9 1,090.6 1,167.9 1,178.2 1,225.9 1,177.6 1,192.1 1,221.0
monthly rates of growth, % 0.9 -0.8 -1.7 4.7 3.4 1.2 0.6 -1.0 -3.9 1.2 2.4
rates of growth since start of year, % 9.6 7.8 12.8 16.6 24.9 26.0 4.1 -0.1 1.2 3.6
share in money supply structure by monetary survey methodology, % 17.6 18.6 18.0 18.4 18.1 18.1 16.3 16.6 15.6 15.1 14.7
Money supply by monetary survey methodology, billion rubles 5,298.7 5,499.6 5,594.0 5,743.0 6,015.9 6,458.4 7,221.1 7,392.9 7,534.2 7,877.6 8,304.8
monthly rates of growth, % 8.9 2.9 1.7 2.7 4.8 2.7 9.3 3.3 1.9 4.6 5.4
rates of growth since start of year, % 3.8 5.6 8.4 13.5 21.9 36.3 2.4 4.3 9.1 15.0
M2 velocity (annualised average) 4.7 4.6 4.6 4.6 4.6 4.5 4.4 4.3 4.3 4.3 4.2
change since start of year, % -1.3 -1.7 -2.1 -2.7 -4.1 -6.1 -1.7 -2.2 -3.0 -4.2
Monetisation (by M2 aggregate), % 21.3 21.6 21.7 21.8 21.9 22.2 22.7 23.1 23.2 23.4 23.7
Broad monetary base, billion rubles 2,380.3 2,250.1 2,237.5 2,263.1 2,302.8 2,538.9 2,914.1 2,721.0 2,863.8 3,242.6 3,285.9
monthly rates of growth, % 14.3 -0.4 -0.6 1.1 1.8 5.0 15.3 2.3 5.2 13.2 1.3
rates of growth on accrual basis, % -5.5 -6.0 -4.9 -3.3 6.7 22.4 -6.6 -1.7 11.3 12.8
Multiplier (by broad monetary base) 1.83 1.99 2.05 2.07 2.14 2.08 2.07 2.27 2.22 2.06 2.16
Change since start of year, % 8.5 11.8 13.0 16.7 13.7 13.2 9.3 7.0 -0.5 4.0
33 2006 Q2
Statistical Addendum
2006 Q2
35 2006 Q2
Statistical Addendum
2006 Q2
37 2006 Q2
Statistical Addendum
2006 Q2
© The Central Bank of the Russian Federation, 2006
Research and Information Department