CBR Quarterly Inflation Review - Q4 2008
Central bank: cbr | Type: quarterly_review | Date: 2008-12-31

THE CENTRAL BANK
OF THE RUSSIAN FEDERATION
(BANK OF RUSSIA)
Quarterly
Inflation
Review
2008 Q4
Research and Information Department
The electronic version of Quarterly Inflation Review is available on the Bank of Russia's website :
 .ru/publ/.
Quarterly Inflation Review is currently issued by the Bank of Russia Research and Information
Department as a document primarily aimed at analysing the latest trends in consumer price dynamics.
Inflation surveys in countries using inflation targeting (inflation forecasts) make projections for probable
deviations from the inflation targets, analyse their causes and determine central bank actions to bring
inflation back to the target. Since the end of 2006, the Bank of Russia has been developing with the
technical assistance of the IMF an analysis and forecast system similar to those used by the countries
implementing inflation targeting. As the analysis and forecast methods will improve, the quarterly
inflation reviews will be enlarged and include new sections.
Contents
Introduction..................................................................................................................3
Inflation.Dynamics.........................................................................................................4
Consumer prices ....................................................................................................................... 4
Housing prices .......................................................................................................................... 6
Producer prices ......................................................................................................................... 6
Foreign trade ............................................................................................................................ 8
Demand ................................................................................................................................. 11
Supply .................................................................................................................................... 14
Labour market ......................................................................................................................... 14
Monetary.Conditions...................................................................................................16
Exchange rate ......................................................................................................................... 16
Interest rates ........................................................................................................................... 18
Asset prices ............................................................................................................................ 22
Monetary aggregates ............................................................................................................... 24
Credit aggregates .................................................................................................................... 27
Statistical.Addendum..................................................................................................29
2008 Q4 3
Introduction
The deepening of the world financial and
economic crisis had a significant impact on the
monetary and exchange rate policy pursued by
the Bank of Russia.
The worsening of the terms of trade and
capital outflow that began in the second half of
2008 exerted strong devaluation pressure on the
rouble. In the fourth quarter of the year it became
clear that the dynamics of the factors determin -
ing the exchange rate of the rouble had become
sustained. To ensure that the rate of the rouble
corresponded to its new equilibrium value, the
Bank of Russia allowed it gradually to depreciate
by widening the range of fluctuations in the value
of a dollar/euro basket. At the same time, it con-
tinued to conduct interventions on the foreign ex-
change market to ensure that the rate of the rou-
ble changed gradually. The rouble rate adjustment
was completed on January 23, 2009. To keep the
value of the bi-currency basket within the estab -
lished fluctuation range, the Bank of Russia used a
set of monetary policy instruments.
Bank of Russia foreign exchange sales in the
course of currency interventions led to the reduc-
tion in the rouble liquidity level. As Russian banks
and non-financial organisations had limited access
to foreign financial resources, the interbank money
market narrowed and banks became increasingly
distrustful of one another , there arose a threat of
bank failures and an outbreak of a systemic bank-
ing crisis. Therefore, financial stability became the
highest priority. The Bank of Russia carried out a
series of measures to ensure the necessary level of
banking sector liquidity by lowering the required
reserve ratios, increasing the refinancing of banks
and easing the refinancing conditions.
The gradual devaluation of the rouble in the
fourth quarter of 2008 was accompanied by the
escalation of the devaluation expectations, which
stimulated additional speculative demand for for-
eign exchange to such an extent that banks and
other borrowers took rouble loans to buy foreign
currency with. The dollar rapidly regained its posi-
tions in the economy and as a result of conversion
of a part of money assets into foreign exchange,
the rouble supply (M2) contracted in absolute
terms.
The prices of Russian securities continued to
fall and this made it increasingly difficult for bor -
rowers to use these papers as collateral for loans.
At the end of the year these developments
created tough monetary conditions for the econ -
omy. Interest rates on loans to non-financial bor-
rowers rose and growth in lending volumes slowed
down sharply.
The toughening of the monetary conditions
has not yet caused inflation to slow down due to
the time lags in the monetary policy transmission
mechanism. The rouble exchange rate dynamics
has been a major factor of rapid price growth in
the past few months.
Despite the slowing of consumer price
growth in the second half of 2008, last year’s in -
flation was higher than it was in 2007.
At present, there are several different factors
that set the rate of inflation. On the one hand, the
fall in the world prices of Russian exports, such as
energy resources, metals and foodstuffs, the re -
duction in producer prices in the Russian mining
sector and agriculture, the slowing of inflation in
the countries that are the major exporters of prod-
ucts to Russia, the slowing of growth in domes -
tic consumer demand and the decline in investor
activity are the factors that contain inflation. On
the other hand, the rise in consumer import prices
caused by the devaluation of the rouble and the
contraction of supply of goods may accelerate in-
flation on the consumer market.
The principal objectives of the monetary pol-
icy in this situation are to maintain financial stabil-
ity and create conditions for the reduction of infla-
tion in the future.
4 2008 Q4
Inflation Dynamics
Consumer prices
According to the Federal State Statistics Ser -
vice (Rosstat), consumer prices in Russia rose by
13.3 % in 2008, an increase of 1.4 percentage
points on the previous year . Consumer prices went
up 4.8 % in the 1 st quarter of 2008, 3.8 % in the
2nd, 1.7 % in the 3rd and 2.5 % in the 4th.
The acceleration of inflation was due to core
inflation, which stood at 3.2 % in the 1st quarter ,
3.4 % in the 2nd, 3.2 % in the 3rd and 3.2 % in the
4th. In 2008 as a whole core inflation accelerated
to 13.6 % as against 11.0 % in 2007.
In 2008, growth in the prices of goods and
services included in the calculation of the core
consumer price index accounted for an estimated
10.8 percentage points, or 81.5 %, of overall con-
sumer price growth (as against 8.7 percentage
points, or 72.8 %, in 2007). The acceleration of
core inflation was largely due to higher growth in
food prices, excluding vegetable and fruit prices,
which began in the second half of 2007.
Food prices, excluding vegetable and fruit
prices, gained 17.5 % in 2008 as against 14.9 %
in 2007. In 2008, growth in these prices ac -
counted for an estimated 6.2 percentage points,
or 46.4 %, of overall consumer price growth. This
compares with 5.4 percentage points, or 45.8 %,
in 2007.
In 2008, prices of bread and bakery products
rose by 25.9 % as against 22.4 % in 2007, pasta
products were up 33.8 % as against 23.6 % a year
earlier and meat and poultry gained 22.2 % as
Consumer price inflation (%)
Growth (December 2008
on December 2007
Growth (December 2007
on December 2006)
Prices of goods and services, total: 13.3 11.9 Acceleration of growth by 1.4 percentage points
of which:
– food prices 16.5 15.6 Acceleration of growth by 0.9 percentage points
– food prices, excluding vegetable and fruit prices 17.5 14.9 Acceleration of growth by 2.6 percentage points
– non-food prices 8.0 6.5 Acceleration of growth by 1.5 percentage points
– prices of paid services provided to households 15.9 13.3 Acceleration of growth by 2.6 percentage points
Prices of goods and services included in core inflation calculation 13.6 11.0 Acceleration of growth by 2.6 percentage points
Source: Rosstat.
Inflation Dynamics
2008 Q4 5
against 8.4 %. It should be noted, however , that
inflation has somewhat slowed down on the food
market. The bumper harvest of grain and some
other crops, the fall in agricultural producer prices
in the second half of 2008 and the reduction or
marked slowing of growth in world food prices led
to the slowing of growth in food prices, excluding
vegetable and fruit prices, to 8.0 % in the second
half of 2008 as against 11.9 % in the same period
of 2007.
After the sharp rise in 2007, prices started to
fall on the world’s grain and vegetable oil markets
in 2008. The price of Canadian wheat began to
drop in March, US wheat in April, Thai rice in May ,
US maize and sunflower oil in July and Canadian
barley in August. As a result, in December 2008,
as compared with December 2007, US and Cana-
dian wheat prices were down 40 % and 31 %, re-
spectively , the price of US maize fell by 12 % and
Canadian barley was down 42 % (in December
2007 these prices rose by 80 %, 99 %, 12 % and
32 %, respectively). The price of sunflower oil in
Europe was down 48 % (it doubled a year earlier),
whereas the price of Thai rice went up 47 % (in
December 2007 it rose 18 %).
After the fall in 2006-2007, world sugar
prices in 2008 began to show signs of growth.
In December 2008, as compared with December
2007, the price of raw sugar rose by 3.8 % and
refined sugar by 9.8 % (in December 2007 sugar
prices fell by 18 % and 26 %, respectively).
The rise in prices registered on world meat
markets since the beginning of 2008 gave way
to a fall in the price of beef in August and pork
in September . As a result, in December 2008 the
price of beef was down 6 % year on year , whereas
pork was up 1.3 % (in December 2007 beef and
pork prices were lower by 1.4 % and 12 %, re -
spectively). Growth in poultry prices went on until
September 2008 and afterwards these prices re -
mained virtually unchanged until the end of the
year . As a result, in December 2008 poultry prices
were up 13 % year on year (in December 2007
they were up 10.9 %).
In 2008, vegetable and fruit prices grew
by 7.7 %, a decrease of 14.5 percentage points
from 2007. Estimates show that as a result of
growth in vegetable and fruit prices, overall con -
sumer price growth increased by 0.3 percent -
age points, or 2.2 %, as against 0.9 percentage
points, or 7.2 %, in 2007. In 2008, vegetable and
fruit prices grew less than they did on average in
the previous three years.
Food prices as a whole rose by 16.5 % in
2008 as against 15.6 % in 2007.
In 2008, growth in non-food prices ac-
celerated to 8.0 % from 6.5 % in 2007 and ac -
counted for an estimated 2.9 percentage points,
or 21.6 %, of inflation (as against 2.3 percentage
points, or 19.4 %, a year earlier). The most signif-
icant growth was registered in the prices of deter-
gents and cleaning products (17.5 % as against
Food price inflation (%)
Growth (December 2008
on December 2007)
Growth (December 2007
on December 2006)
Food products 16.5 15.6 Acceleration of growth by 0.9 percentage points
Bread and bakery products 25.9 22.4 Acceleration of growth by 3.5 percentage points
Cereals and legumes 25.8 24.7 Acceleration of growth by 1.1 percentage points
Pasta 33.8 23.6 Acceleration of growth by 10.2 percentage points
Meat and poultry 22.2 8.4 Acceleration of growth by 13.8 percentage points
Fish and seafood 15.1 9.0 Acceleration of growth by 6.1 percentage points
Milk and dairy products 12.2 30.4 Slowing of growth by 18.2 percentage points
Butter 10.5 40.3 Slowing of growth by 29.8 percentage points
Sunflower oil 22.1 52.3 Slowing of growth by 30.2 percentage points
Granulated sugar 7.0 -4.3
Vegetables and fruit 7.7 22.2 Slowing of growth by 14.5 percentage points
Alcoholic beverages 10.9 7.7 Acceleration of growth by 3.2 percentage points
Source: Rosstat.
6 2008 Q4
8.0 % in 2007), medicines (16.4 % as against
5.5 %) and tobacco products (16.1 % as against
7.7 %). The fall in oil prices caused petrol prices
to decline by 14.7 % in the fourth quarter of the
year , whereas in 2008 as a whole petrol prices
rose by 1.2 % as against 8.5 % a year earlier . Non-
food prices, excluding petrol prices, went up by
an estimated 8.4 % in 2008, an increase of 2.0
percentage points over 2007.
In 2008, prices of the paid services pro -
vided to the public rose by 15.9 % as against
13.3 % in 2007. It has been estimated that they
accounted for 4.0 percentage points, or 29.8 %,
of overall consumer price growth (as against 3.3
percentage points, or 27.7 %, in 2007).
Administered prices of paid services grew by
an estimated 14.5 %, an increase of 0.9 percent-
age points on a year earlier . Housing and utility
prices rose by 16.4 % as against 14.0 % in 2007.
Passenger transport fares went up 22.5 % as
against 13.6 % a year earlier .
In 2008, service prices increased by 3.5
percentage points faster than commodity prices
in general (this compares with 2.0 percentage
points in 2007).
According to Rosstat data, in 2008 consumer
price growth in all federal districts was higher
than in 2007.
Estimates show that regional differences in
the cost of a fixed set of goods and services used
by the Federal State Statistics Service for interre -
gional purchasing power comparisons became
less pronounced in 2008. The regional difference
ratio1 decreased from 40.2 % to 40.0 % last year .
Growth in non-food prices was roughly the
same in all federal districts in 2008 (from 7.8 %
to 9.9 %).
As for vegetable and fruit prices, their growth
differed widely region by region. In the Volga
Federal District, for example, these prices rose
by 3.4 % (as against 32.9 % in 2007), whereas
in the Far Eastern Federal District they grew by
15.8 % (as against 9.7 % in 2007).
In 2008, growth in service prices accelerated
in all federal districts, as compared with the previ-
ous year .
Housing prices
In 2008, housing prices rose by 10.3 % on
the primary market and 15.3 % on the secondary
market. Compared with 2007, growth in housing
prices slowed by 13.1 percentage points and 5.3
percentage points, respectively. There was a fall in
housing prices in the fourth quarter of 2008.
In 2008, growth in housing construction
slowed down significantly. In 2007, it was 20.6 %
over 2006, whereas in 2008 it was just 4.5 %.
This along with the slowing of growth in housing
prices on the primary market may serve as a sign
of the saturation of solvent demand in this seg -
ment of the real estate market. It should be noted
that as this demand was partly created by inves -
tors, the slowing of price growth may be the result
of the world financial crisis.
Producer prices
Industrial producer prices were down 7.0 %
in 2008, whereas in 2007 they rose 25.1 %. The
price fall began in September and was particularly
marked in the mining sector , where producer prices
declined by 53.6 % in September-December due
to the fall in world hydrocarbon and metal prices.
In 2008, producer prices in the fuel and energy
sector dropped by 42.2 %, whereas in 2007 they
rose by 58.1 %. Producer prices in the ore mining
sector were down 9.7 %, whereas a year earlier
they increased by 11.5 %.
1 The regional difference ratio is calculated by the Bank of
Russia as the difference between the cost of a fixed set of
goods and services in the most expensive and the cheapest
regions relative to the national average cost of the set.
Inflation Dynamics
2008 Q4 7
The sharp fall in producer prices in the min -
ing sector leads to cost reduction, which, in turn,
eases the inflationary pressure. Over the year price
growth in the manufacturing sector stood at 1.9 %
as against 17.9 % in 2007. The slowing of pro -
ducer price growth in the manufacturing sector in
2008 was due to the price fall in the production
of coke and petroleum products by 27.3 % (there
was a growth of 43.4 % in 2007). Price growth
also slowed down in the production of foodstuffs,
including beverages, and tobacco (to 12.3 % as
against 20.0 % in 2007) and the production of
leather , leather goods and footwear (to 8.4 % as
against 8.7 %). At the same time, price growth
accelerated in the production of textile and cloth-
ing (to 10.8 % as against 9.6 %).
Price growth in the production, transmission
and distribution of electricity , gas and water stood
at 18.0 % in 2008 as against 13.3 % in 2007.
Freight transportation charges rose by
41.4 % in 2008 as against 6.8 % in 2007. Rail -
way fares increased by 22.1 % as against 7.7 % a
year earlier .
Communication fees for corporate enti -
ties increased by 11.5 % in 2008 as against 4.0 %
in 2007.
In 2008, the aggregate building materi -
als price index registered 116.9 % as against
117.4 % in 2007.
8 2008 Q4
Inflation in some countries of the world1
Inflation in the countries that account for a significant share of Russian imports slowed to 5 % in 2008
(December on December of the previous year) from 5.9 % in 2007. Most of Russia’s European trading partners,
the United States and China registered the slowing
of price growth. The lowest inflation rate was regis -
tered in the United States (over the year the level of
consumer prices remained virtually unchanged in that
country), the highest in Ukraine. China, Kazakhstan,
Germany and the United States made the biggest
contribution to the slowing of aggregate consumer
price growth among Russia’s major trading partners.
In the first half of the year inflation accelerated in
foreign countries due to growth in energy and food
prices, but in the third quarter prices on raw mate -
rial markets stabilized and began to fall. This price fall
continued into the fourth quarter . The contraction of
domestic demand due to the recession led to the sig-
nificant slowing of inflation in the developed coun -
tries in the fourth quarter of last year . The relatively
high rates of inflation in the former Soviet republics in
the fourth quarter were due to growth in the devalu-
ation expectations.
1 According to data compiled by the Bureau of Labor Statistics at the US Department of Labor, the Statistical Office of the European Communi-
ties Eurostat and national statistical offices of other countries.
In 2008, agricultural producer prices
edged up 2.5 % as against 30.2 % in 2007. Crop
grower prices fell by 2.6 % over the year , where-
as in 2007 they increased by 37.3 %. Sunflower
prices were down 13.4 % (in 2007 they were up
105.7 %) and grain prices 4.6 % (as against the
rise of 45.5 % a year earlier). In 2008, livestock
product prices rose by 6.1 % as against 25.5 % in
2007. The most significant increase was registered
in livestock and poultry prices (17.4 % as against
8.0 % a year earlier). Milk prices were down
9.2 %, whereas in 2007 they jumped 56.4 %.
Foreign trade
Despite the fall in the prices of oil and many
other raw materials in the second half of 2008,
the price situation on the world markets for the
major Russian exports2 last year was much better
2 Average prices are based on data provided daily by the fol-
lowing news agencies and exchanges: Reuters for oil, Petro-
leum Argus for petroleum products (petrol, diesel fuel and
fuel oil) and the London Metal Exchange for non-ferrous
metals (aluminium, copper and nickel). Ferrous metal prices
are the price indices and natural gas prices and prices of oth-
er commodities are monthly averages published by the World
Bank and the IMF .
than in 2007. Energy prices rose by 43 % on aver-
age and non-energy prices increased by 21 %.
The acceleration of growth in oil prices in the
first half of 2008 was due to the high demand for
energy by the major consumers and investors,
the reduction of world crude stocks, the devalua-
tion of the US dollar and geopolitical instability in
the world. Oil prices reached the highest level on
July 11, when Urals traded for $ 139.9 per bar -
rel.
In the middle of July , the situation on world
commodity and raw material markets changed.
The dollar’s appreciation, the outflow of invest -
ments from commodity markets and the expecta-
tions of a contraction in world demand for energy
amid the worsening world financial crisis and re -
cession in the United States and some European
countries led to a sharp fall in oil prices in July-De-
cember . As a result, the world market saw prices
fall more than four times. Specifically , the price of
Urals crude plunged to $ 32 per barrel at the end
of December . As a result, the average price of Rus-
sian oil in December ($ 38.1 per barrel) was the
lowest in the past four years. In the third quarter
prices fell by 4 % quarter on quarter , whereas in
Inflation Dynamics
2008 Q4 9
the fourth quarter they were down 53 %. Never-
theless, the average world market price of Russian
oil in 2008 was $ 93.9 per barrel, an increase of
35 % on the previous year (in 2007 the price of oil
went up 14 %).
The fall in the price of oil was followed by
the decline in petroleum product prices: the price
of premium petrol and diesel fuel began to fall in
July and that of straight-run petrol and fuel oil in
August. As a result, in the third quarter petroleum
product prices were on average by 2 % higher
than in the second, whereas in the fourth they
dropped almost by half. In 2008, average petro -
leum product prices were by 41 % higher than a
year earlier (in 2007 they were up 13.5 % on the
previous year). The most significant growth was
registered in the price of diesel fuel (48 %) and
fuel oil (36 %); the price of premium petrol was
up 19 % and straight-run petrol rose by 18 % (in
2007 these prices rose by 10 %, 18 %, 14 % and
19 %, respectively).
The price of natural gas in Europe started to
fall in late 2008: it dropped by 1 % in November
month on month and 2 % in December . On aver-
age the price of natural gas in 2008 rose by 57 %
year on year (a year earlier it inched up 1 %). Coal
prices began to fall in August, but in 2008 they
were on average by 90 % higher than a year ear -
lier (in 2007 they rose 30 % year on year).
In 2008, the main factor of the price upturn
on the world ferrous metal market was the rise
in electricity prices and the prices of raw materi -
als for the production of ferrous metals (iron ore
prices soared by 70 % year on year , whereas a
year earlier they increased by 9.5 %). However , in
September 2008 ferrous metal prices started to
fall due to the slowing of growth in demand, es -
pecially in China. In the fourth quarter of the year
ferrous metal prices were on average down 8 %
from the third, but in 2008 as a whole they were
by 60 % higher than a year earlier (in 2007 fer -
rous metal prices were unchanged from the previ-
ous year).
The fall in non-ferrous metal prices in 2008
was caused by the escalation of the world financial
crisis and the world economic downturn, which
led to the reduction of industrial producer and in-
vestor demand for non-ferrous metals. The price
of aluminium started to fall in April and copper in
May 2008 and the price of nickel began to slide
in June 2007. On average, the price of aluminium
and copper went down by 2.4 % in 2008 (a year
earlier they rose by 2.6 % and 5.9 %, respectively)
and nickel prices were down 43 % (in 2007 they
rose by 54 %).
In 2008, the prices of other Russian raw ma-
terial exports, except timber and sawtimber , rose
significantly on world markets. The price of min -
eral fertilizers doubled year on year and chemical
raw materials gained 70 % (a year earlier these
prices rose by 30 % and 20 %, respectively). Tim-
ber prices were down 12 % on average and saw-
timber prices slipped 11 % in 2008 year on year
(in 2007 they were down 19 % and 4.5 %, re -
spectively).
Food and agricultural raw material prices 3
also began to fall on the world markets in 2008,
but on average they were higher than in 2007.
After the sharp rise in wheat prices in the
period from May 2007 to March 2008, the price
downtrend prevailed in April 2008 due to the ex-
pectations of a good harvest and the economic
situation in the world. Maize and barley prices,
which rose in the first half of the year due to high
demand, especially in ethanol production, de -
clined in the second: the price of maize began to
fall in July and barley in August. Grain price dy -
namics was affected not only by the changed situ-
3 Average sugar prices have been calculated on the basis of
data provided daily by the London Commodity Exchange,
while other prices are monthly averages published by the
World Bank and the IMF .
10 2008 Q4
ation on the world food market, but also the fall in
energy prices.
The price downturn accelerated in the fourth
quarter of 2008: compared with the third quar -
ter , the price of US wheat and maize fell by 28 %
and 31 %, respectively , and the price of Canadian
wheat and barley was down 18 % and 40 %, re-
spectively. Despite the sharp fall, in 2008 these
prices were higher than in 2007: the price of US
wheat was higher by 28 %, Canadian wheat by
51 %, US maize by 36 % and Canadian barley
by 16 % (a year earlier these grain prices rose by
33 %, 39 %, 34 % and 48 %, respectively). The
sharp acceleration of growth in rice prices in the
first half of 2008, caused by a relatively poor har-
vest and, as a consequence, the contraction of
stocks and the restrictions imposed on rice exports
by some countries, gave way to a price downturn
in the second half of the year . The principal factors
that affected the world rice price dynamics were
the expectations of a good harvest in the major
producing countries and the overall fall in prices
on raw material markets. Compared to the previ -
ous quarter , the price of rice fell by 18 % in the
third quarter and 20 % in the fourth, but in 2008
as a whole the price of rice was on average twice
as high as a year earlier (in 2007 it was up 7 %).
Sunflower oil prices rose in the first half of
2008 due to the reduction of production and ex -
ports from Ukraine and Argentina. In the second
half of the year sunflower oil prices began to fall
due to good harvests, the expansion of world
stocks and the slowing of growth in demand. At
the end of the year sunflower oil prices in Europe
sank to the low registered in April 2007. In the
third quarter of 2008, sunflower oil prices in Eu -
rope fell by 28 % quarter on quarter and in the
fourth 36.5 %. However , in 2008 the price of
sunflower oil was on average almost 50 % higher
than a year earlier (in 2007 it rose by 55 %).
Growth in the world demand for meat, ac -
companied by the rise in energy and fodder prices,
pushed prices up during the first eight months of
2008. Afterwards, the expectations of the slowing
of growth in demand, connected with the deterio-
ration of the economic situation in the major meat
consuming countries, good grain harvests and
Inflation Dynamics
2008 Q4 11
the fall in fodder , energy and fuel prices affected
the dynamics of livestock and poultry prices. Beef
prices started to fall in August and pork prices in
September , while poultry prices remained virtually
unchanged during the last five months of 2008.
As a result, in the fourth quarter of 2008 the price
of beef fell by 28 % quarter on quarter , pork 27 %
and poultry 1.4 %. Despite the price downturn, in
2008 the price of beef was on average by 21 %
higher than a year earlier , pork by 1.6 % and poul-
try by 8.2 % (in 2007 beef and poultry prices rose
by 2.2 % and 13 %, respectively , while pork prices
were unchanged from 2006).
The world sugar market saw prices rise in
the first and third quarters of the year and fall in
the second and fourth. In 2008, the overall price
trend was towards growth as crop areas were re-
duced, production declined and world stocks con-
tracted in the past two years despite high demand.
In 2008, the price of raw sugar rose by 15 % on
average and refined sugar 14 % (in 2007 these
prices were down 36 % and 34 %, respectively).
The fall in export prices in the fourth quar -
ter of 2008, more dramatic than the fall in im -
port prices, led to the worsening of the terms of
Russia’s trade with other countries,4 but overall in
2008 they were much better than in 2007.
Russia’s trade surplus5 contracted 2.4 times
in the fourth quarter of 2008, as compared with
the third, as exports declined more than imports
(by 30 % against 13 %). However , in 2008 Rus-
sia’s trade surplus increased by more than one-
third year on year and stood at $ 176.6 billion (in
2007 it contracted by 6 % to $ 130.9 billion).
Demand
Domestic demand
The world financial and economic crisis ad -
versely impacted the Russian economy in the sec-
ond half of 2008. The fall in revenues in various
sectors of the economy and the toughening of
the borrowing terms and conditions in the fourth
quarter of the year led to the slowing of growth in
investor and consumer demand in Russia. It has
been estimated that domestic demand for im -
ports fell in that period due to the devaluation of
the rouble.
In January-September 2008, the share of
imported products in retail trade commodity re -
4 The ratio between export and import price indices.
5 According to the balance of payments estimate as of Janu-
ary 13, 2009.
Foreign trade in some countries of the world1
In the middle of 2008, the terms of trade began to change for the worse for the oil exporting countries.
Nevertheless, the mineral fuel export conditions were relatively good for Russia in 2008, as the European Union
member countries, which account for a large portion of Russian exports, maintained oil consumption at a rela-
tively stable level. In addition, natural gas supplies, which account for a large part of Russian exports to the
EU countries, were conducted under fixed contract prices in the second half of the year . EU member countries
increased expenditures on mineral fuel exports in 2008, but in August these expenditures began steadily to
decline due to the fall in the price of oil and petroleum products. Russian exports accounted for more than a
quarter of EU countries’ mineral fuel consumption. Their value also began to decrease in August. According to
the International Energy Agency , oil consumption in Europe fell by 0.8 % in 2008.
1 According to data provided by the International Energy Agency , International Monetary Fund and Statistical Office of the European Com-
munities Eurostat.
12 2008 Q4
sources contracted by 0.6 percentage points, as
compared with the same period of 2007, and
stood at 45.7 %. The share of revenues from food
imports dwindled by 0.9 percentage points to
35.6 % and non-food imports by 0.2 percentage
points to 54 %.
In the fourth quarter of 2008, imports of
investment goods declined more than imports
of consumer goods as compared with the previ -
ous quarter . Food imports remained virtually un-
changed from the previous quarter .
The slight fall in import prices in the fourth
quarter was accompanied by the significant con -
traction of import volumes. Growth in engineering
import volumes began to slow down on a year-
on-year basis in June and food and agricultural
raw material import volumes in October .
Despite the fourth-quarter import dynam -
ics, engineering imports grew considerably faster
than food imports and their share in total imports
reached 52.7 % in 2008 as against 50.9 % in
2007. Food imports increased year on year due
to not only the accelerated growth in contract
prices, but also the expansion of import volumes,
but their share contracted to 13.2 % in 2008 from
13.8 % in 2007.
As import prices, especially food import pric-
es and prices of imports of raw materials for food
production, increased faster than in 2007, prices
grew on the domestic market.
In the fourth quarter of 2008, household real
disposable money income fell by 5.8 %. As the de-
valuation expectations increased, people preferred
to maintain the level of current consumption and
buy foreign exchange. The share of household
spending on the purchase of goods and services
expanded by 5.8 percentage points to 71.8 % in
the fourth quarter of 2008, as compared with the
same period in 2007, and the share of spending
on the purchase of foreign exchange expanded
by 8.3 percentage points to 13.4 %. The public
propensity for organised savings declined signifi -
cantly (from 11 % to 3 %).
In 2008, the share of remuneration in house-
hold money income expanded from 67.5 % to
68.5 % and that of social transfers from 11.6 %
to 12.9 %. The share of consumer spending in
household income use expanded over the year
from 69.6 % to 73.1 %, compulsory payments
and fees from 11.8 % to 13.0 % and foreign ex -
change purchases from 5.2 % to 7.9 %. The share
of organised savings contracted by 3.6 percent -
age points to 6.0 %. Household spending on fi -
nal consumption increased by 11.5 % in 2008 as
against 13.6 % in 2007.
Government expenditures on final consump-
tion increased by 2.5 % in 2008 as against 3.4 %
a year earlier . According to the Federal Treasury’s
preliminary data, the federal budget surplus rela-
tive to GDP in 2008 contracted by 1.3 percentage
points year on year , to 4.1 %. The non-oil-and-gas
deficit increased by 3.2 percentage points year on
year and stood at 6.5 % of GDP . These figures tes-
tify to a slight easing of the fiscal policy and the
increased dependence of the revenue part of the
federal budget on the oil and gas sector . Federal
budget revenue decreased by 1.2 percentage
points year on year and stood at 22.3 % of GDP .
The major factors of reduction in federal budget
revenue in the fourth quarter of 2008 were the
fall in the price of oil and other export commodi -
ties and the deterioration of some economic per -
formance indicators due to the financial crisis.
GDP consumption*
(growth as % of corresponding period of previous year)
2007 2008**
Q1 Q2 Q3 Q4 Full year Q1 Q2 Q3 Full year
GDP 7.40 8.10 7.30 9.50 8.10 8.50 7.50 6.20 5.60
Final consumption 10.40 10.60 10.50 11.00 10.80 10.60 9.40 9.80 9.00
Of which:
– households 12.40 12.70 12.80 13.10 13.60 14.10 12.20 12.40 11.50
Gross capital formation 24.90 25.90 18.10 23.60 21.10 10.40 17.80 14.00 13.30
Net exports -23.90 -29.20 -41.00 -20.40 -26.90 -7.30 -32.60 -81.20 -43.80
* Disaggregation by quarter does not match full-year data; Rosstat update is expected in March 2009.
** Data for 2008 Q4 are unavailable.
Source: Rosstat.
Inflation Dynamics
2008 Q4 13
In 2008, federal budget expenditure in -
creased to 18.2 % of GDP as against 18.1 % in
2007. Non-interest expenditures increased by
0.2 percentage points year on year , to 17.8 % of
GDP , the highest level since 2000. The reason is
the transfer of a part of expenditure obligations
from 2007 to 2008, the implementation of mea-
sures to secure financial stability and the improved
execution of 2008 budget expenditures. Budget
expenditures continued to spread unevenly dur -
ing 2008, especially in the fourth quarter , which
accounted for 39.8 % of the full-year expendi -
tures (as against 42.7 % in 2007).
The Russian government continued to ab -
sorb additional oil and gas revenues through the
Reserve Fund and National Wealth Fund, which
allowed it to increase the total value of these funds
by 71.8 % in rouble terms and contain growth in
consumer prices.
Gross capital formation increased by 13.3 %
in 2008 as against 21.1 % in 2007. Growth in
fixed capital investment continued to slow down
in October and November and a decline in fixed
capital investment was registered in December .
In the fourth quarter of the year , fixed capital in-
vestment increased by 1.8 % as against 20.6 % in
the same period of 2007. Overall, growth in fixed
capital investment in 2008 slowed to 9.1 % from
21.1 % a year earlier . The biggest capital invest-
ments were made in the mining sector , transport
and communications.
Investments in machinery , equipment and
transport vehicles made up over one-third of total
investments. The purchase of import equipment
account for about one-fifth. Imports of machin -
ery , equipment and transport vehicles increased
by 56.8 % in January-September 2008 as against
55.8 % in the same period of 2007.
Most of fixed capital investments (57.2 %)
were financed from borrowed funds in January-
September 2008. Bank loans accounted for 11 %
as against 10.2 % in the same period a year ear -
lier .
As import volumes grew considerably faster
than exports, net exports of goods and services
contracted by 43.8 % in 2008.
Overall, domestic demand continued to ex -
pand at rapid rates (over 10 %) in 2008, despite
the significant contraction registered in the last
few months, and as a result, production surpassed
its natural (potential) level for most of the year .
Foreign demand
The slowing of foreign demand and the price
downturn on world commodity markets amid the
worsening financial and economic crisis in the
world affected Russian export dynamics in the
fourth quarter of 2008. Compared to the previ -
ous quarter , Russian exports contracted not only
because of the fall in prices, but also as a result
of the contraction of export volumes. The fourth
quarter saw the contraction of Russian oil exports
to non-CIS countries.
Overall, exports of goods 6 increased by
32.3 % in 2008 year on year and stood at $ 469.0
billion. Exports of goods to the APEC member
countries, especially the United States and Japan,
and the EU members, particularly Italy and Po -
land, grew faster than overall exports 7 in 2008.
Exports to Ukraine and Belarus continued to ex -
pand rapidly.
Year-on-year growth in the value of Russian
exports of goods in 2008 was largely due to the
rise in prices, as export volumes expanded slight-
ly. Energy products accounted for most of this
growth. The rise in energy export prices was ac -
companied by the expansion of natural gas and
6 According to the balance of payments estimate as of Janu-
ary 13, 2009.
7 According to Russia’s Federal Customs Service.
14 2008 Q4
petroleum product export volumes. The amount
of oil exported to the world market declined in
2008.
Supply
The production of goods and services contin-
ued to grow rapidly in the first half of 2008, as
the foreign trade situation remained favourable
for the Russian exporters and domestic demand
increased significantly. The world economic and
financial crisis had a negative effect on production
growth in Russia, especially in the last few months
of 2008. Output in the key types of economic
activity contracted by 2.7 % in the fourth quarter
of the year , whereas full-year growth slowed to
4.5 % from 8 % in 2007. There was a slowing of
growth in the construction sector and retail trade
in the fourth quarter of 2008, as compared with
the same period in 2007, while output declined in
industry , wholesale trade and transport. Overall,
retail trade turnover expanded by 13 % in 2008
as against 16.1 % in 2007, construction volume
12.8 % (18.2 %), wholesale trade turnover 4.7 %
(13.4 %) and freight transport turnover 0.6 %
(2.4 %).
The industrial production index registered
102.1 % in 2008 as against 106.3 % in 2007.
Production growth slowed from 9.5 % in 2007 to
3.2 % in 2008 in the manufacturing sector and
from 1.9 % to 0.2 % in the mining sector .
Price dynamics in the economy was affected
by the expansion of the supply of farm produce,
whose output increased by 10.8 % in 2008 year
on year as against 3.4 % in 2007. Gross produc -
tion of grain in 2008 grew by 32.6 %, sugar beet
0.7 %, potatoes 6.2 % and vegetables 12.9 %.
Growth was registered in the output of the major
livestock products, including cattle and poultry in
slaughter weight (6.5 %) and milk (1.1 %). The
production of granulated sugar from sugar beet
increased by 7.8 % in 2008 year on year and
meat and meat products 5.5 % (of which meat,
including premium quality meat sub-products, in-
creased by 11.6 %). In that situation, growth in
agricultural producer prices slowed down.
GDP growth stood at 5.6 % in 2008 as
against 8.1 % in 2007.
Labour market
In 2008, the number of jobs in the econo -
my increased by 0.6 % as against 2.4 % in 2007.
Economic growth in foreign countries1
GDP growth in countries that account for a large share of Russian exports slowed to an estimated 2.7 % in
2008 from 4.8 % in 2007. According to preliminary data, in 2008 GDP increased by 1.3 % in the United States
(as against 2 % in 2007), 0.7 % in the eurozone (2.6 %) and 9 % in China (13 %).
The reproduction cycle in the leading industrialised nations changed its phase from economic growth to
recession. The contraction of GDP for two consecutive quarters, which signifies recession by international stan-
dards, was registered from April to September 2008 in Germany , Italy and Japan. Preliminary data show that
in the fourth quarter of 2008 the United States and Britain saw their GDP continue to contract for the second
quarter . According to the US methodology for determining the phases of the reproduction cycle, the recession
began in that country in December 2007. The recession in the developed nations adversely impacted the situa-
tion in other countries, including Russia’s trading partners in Europe and Asia, due to the weakening of demand
for industrial and raw material exports and the reduction of capital inflow.
1 According to data compiled by the US Department of Commerce Bureau of Economic Analysis, the Statistical Office of the European Com-
munities Eurostat, China’s National Statistics Bureau and national statistical offices of other countries.
Inflation Dynamics
2008 Q4 15
However , this indicator had different dynamics
during the year . In September , the sustained trend
towards growth gave way to decline and in the
fourth quarter of the year the number of jobs fell
by 0.3 %, as compared with the same period of
2007.
In 2008, labour productivity rose by an esti -
mated 5.0 % as against 5.6 % in 2007. In Janu -
ary-September the rates of growth in labour pro-
ductivity in the manufacturing sector were higher
than in the services sector . The production of ser-
vices grew faster than the production of goods.
The number of jobs increased year on year in the
services sector but decreased in the manufactur -
ing sector .
As in the previous years, real wage in 2008
rose faster (by 9.7 %) than labour productivity ,
but the gap between real wage and labour pro -
ductivity growth rates narrowed.
The share of remuneration in the GDP struc -
ture by income expanded from 46.3 % in 2007 to
46.6 % in 2008.
Significant differences remained in wage lev-
els in different types of activity. The highest aver-
age monthly wage in January-November 2008
was registered in the financial sector (39,681
roubles) and the mining sector (37,680 roubles).
It exceeded the national average 2.4 times and
2.2 times, respectively. The lowest wage was reg-
istered in agriculture, hunting and forestry (8,022
roubles), textile and clothing industry (8,026
roubles) and the production of leather , leather
goods and footwear (9,328 roubles). It was,
respectively , 47.7 %, 47.7 % and 55.4 % of the
national average. Wages and salaries below the
national average were registered in the types of
activity largely financed from the federal budget
(education, utilities, public and personal services,
healthcare and social services) and in the manu -
facturing sector , wholesale and retail trade, car
and other repair services.
The number of unemployed, calculated ac -
cording to the ILO methodology , increased by
4.3 % in 2008 as against 13.3 % in 2007. It
should be noted that in the first half of the year the
number of jobless declined, whereas in July the
number of unemployed began to rise. The high -
est rate of growth in jobless numbers (23 %) was
registered in the fourth quarter of 2008. The total
number of unemployed in 2008 stood at 6.3 %
of the economically active population (as against
6.1 % in 2007).
16 2008 Q4
Monetary Conditions
Exchange rate
The rouble exchange rate dynamics in the
fourth quarter of 2008 was affected by the wors-
ening of the foreign trade situation and the world
financial crisis. According to preliminary data, the
Russian balance of payments deteriorated signifi-
cantly in that period: the current account surplus
contracted sharply (to $8.0 billion from $27.6
billion in the third quarter). Private sector net capi-
tal outflow, estimated at $130.5 billion, far sur -
passed the third-quarter level ($17.4 billion).
As private capital flowed out of the coun -
try and the price of oil fell sharply on the world
market, the situation on the domestic foreign
exchange market was affected by the rise in the
demand for foreign exchange. To keep the value
of the bi-currency basket within the established
range, the Bank of Russia sold large amounts of
foreign currency , whose net value reached $43.1
billion in October and $33.8 billion in November .
In the period from November 11, 2008, to Janu-
ary 23, 2009, the Bank of Russia conducted a
large-scale gradual adjustment of the bi-curren -
cy basket fluctuation range. At the same time, it
continued to buy foreign currency to ensure the
smooth adjustment of the rouble rate.
The nominal rouble/US dollar rate contin-
ued to fall in the fourth quarter of 2008, losing
11.1% against the previous quarter . On the one
hand, the significant devaluation of the rouble
against the US dollar in that period was due to the
transition to a more flexible exchange rate-setting
policy on the domestic foreign exchange market,
which led to the substantial change in the rouble
value of the bi-currency basket. On the other
hand, it was the result of the continued sharp ap-
preciation of the US dollar against the euro on the
international currency market. In January 2009,
the rouble lost 10.6% of its value against the dol-
lar , as compared with the previous month. As of
February 1, 2009, the rouble/dollar rate stood at
35.4146 roubles to the dollar .
The nominal rouble/euro rate rose by
1.4% in the fourth quarter of 2008 as compared
with the third (it continued to rise for the second
consecutive month). The rouble’s appreciation
against the common European currency was due
to the euro’s fall against the US dollar on the in -
ternational currency market. However , in Decem-
ber , when the euro appreciated against the dollar ,
the nominal rate of the rouble against the euro
fell sharply not only month on month, but also
as compared with December 2007. Compared
with December 2008, in January 2009 the rouble
depreciated by 10.4% against the euro and as
of February 1, 2009, the rate stood at 45.6636
roubles to the euro.
The nominal rouble value of the bi-cur -
rency basket, composed of 0.45 euros and 0.55
US dollars, increased by 4.8% in the fourth quar-
ter of 2008 quarter on quarter (in the third quar-
ter it rose by 0.5%). In January 2009, the nomi -
nal value of the bi-currency basket grew further
by 11.8%. On January 23, 2009, the Bank of
Russia set the upper limit on the range of fluctua-
tions in the value of the bi-currency basket at 41
roubles. At the end of January 2009, the value of
the bi-currency basket stood at 40.0267 roubles.
Estimates show that the value of the bi-currency
basket registered at the end of January 2009 was
close to its medium-term equilibrium level.
The real rouble/US dollar rate fell by 6.3%
in the fourth quarter of 2008 due to the decline
Monetary Conditions
2008 Q4 17
of the nominal rate. The effect of this factor was
partly offset by the increase in the inflation differ-
ential between Russia and the United States due
to the reduction in the fourth quarter of 2008 of
the general level of consumer prices in the United
States amid the slight acceleration of inflation in
the Russian economy. In January 2009, the real
rouble/US dollar rate fell by an estimated 7.5%.
The real rouble/euro rate rose by 4.2% in
the fourth quarter of 2008. This growth was due
to the rise in the nominal rate and the increase in
the inflation differential between Russia and the
eurozone, caused, among other things, by the
slight fall of the general level of consumer prices in
Europe in the fourth quarter of last year . In Janu-
International currency market
In the first half of 2008, the international currency market continued to register the devaluation of the US
dollar against the currencies of most of Russia’s trading partners, but in the second half of the year the dollar
appreciated sharply. Over the year (December 2008 on December 2007) the dollar gained over 7% against
the euro. The contraction amid financial market instability of the volume of transactions based on differenc -
es between interest rates and rates of return on as -
sets denominated in different currencies resulted in
the Japanese yen appreciating by more than 23%
against the US dollar . The second half of the year saw
the slowing of the yuan’s rally against the US dollar,
which amounted to 7.5% over the year .
Capital outflow led to the significant weaken -
ing of the currencies of Turkey , South Korea, India
and Brazil. The currencies of some non-euro mem -
ber countries of the European Union, such as Great
Britain, Sweden, Poland, Hungary and Romania,
depreciated against the US dollar and the euro. The
currencies of other countries in this group, such as
the Czech Republic, Lithuania, Estonia and Bulgaria,
weakened against the US dollar . Financial market tur-
moil in Ukraine, accompanied by the run on banks
and the rise in demand for foreign exchange, led to
the sharp devaluation of the hryvnia. The currencies
of Belarus and Kazakhstan remained stable in 2008
(they depreciated in the first quarter of 2009).
18 2008 Q4
ary 2009, the real rouble/euro rate fell by an es -
timated 8.1%.
The real effective rate of the rouble gained
2.8% in the fourth quarter of 2008 as against
0.5% in the third. The main contribution to the
strengthening of the real effective rate in that pe-
riod was made by the accelerated inflation rate in
Russia amid the reduction of the aggregate infla -
tion rate registered by Russia’s trading partners. In
January 2009, the real effective rate of the rouble
fell by an estimated 7.4%.
Interest rates
Money market and Bank of Russia interest
rates
To check inflation and capital outflow, the
Bank of Russia in the fourth quarter of 2008
raised interest rates on its operations. Specifically ,
it pushed up twice (on November 12 and Decem-
ber 1, 2008) the ceiling it had set on its interest
rates. The overnight credit rate, which set the up-
per limit of the interest rate band, was lifted to
Foreign central bank policies
The policy pursued by foreign central banks in
2008 was largely aimed at countering the negative
trends in the financial sector and preventing a sys -
temic banking crisis. However, in the first half of the
year the policy pursued by the monetary authorities
in some countries was seriously affected by the need
to curb inflation. In the second half of the year most
of Russia’s trading partners changed their mone -
tary policy to gear it towards stimulating economic
growth and preventing deflation. In the second half
of 2008 and the beginning of 2009 most of Russia’s
trading partners were cutting interest rates.
The US Federal Reserve from January to Octo -
ber 2008 cut the benchmark federal funds rate from
4.25% to 1% p.a. (in September 2007 the bench -
mark rate was 5.25% p.a.) and in December set it
for the first time as an interval from 0 to 0.25% p.a.
The European Central Bank (ECB) in July 2008 raised
the refinance rate from 4% to 4.25% p.a., but in the
period from October to December cut it to 2.5% and
in January 2009 to 2% p.a.
Monetary Conditions
2008 Q4 19
12% and later to 13% p.a. The ‘tom-next’ depos-
it rate, which set the lower limit of the band, was
also raised, first from 4.75% to 5.75% p.a. and
then to 6.75% p.a. At the same time, the mini -
mum overnight repo auction rate was raised from
7% to 8% p.a. and then to 9% p.a. The Bank of
Russia also raised interest rates along the entire
range of its operations.
In February 2009, the Bank of Russia con -
tinued to raise interest rates on its operations. It
raised the minimum overnight repo auction rate
from 9% to 10% p.a. and the ‘tom-next’ deposit
rate from 6.75% to 7.75% p.a. The overnight
credit rate remained unchanged at 13% p.a. Si -
multaneously the Bank of Russia raised interest
rates on its other operations (see Statistical Ad -
dendum, T able 9).
In the fourth quarter of 2008, as the world
financial crisis deepened and private capital out -
flow from Russia increased, tension and uncer -
tainty arose in the main segments of the Russian
financial market. The banking sector continued to
experience rouble shortages, despite the fact that
the Bank of Russia was refinancing credit institu -
tions on a large scale. Interest rates on rouble-
denominated interbank loans rose significantly.
The average quarterly MIACR on overnight rouble
loans reached 8.4% p.a. as against 5.7% p.a. in
the previous quarter . The rise in the average level
of interest rates was accompanied by the sharp ex-
20 2008 Q4
Bank of Russia operations to refinance credit institutions from October 2008 to January 2009
In addition to the measures taken earlier, 1 the Bank of Russia Board of Directors, seeking to alleviate the
aftermath of the world financial crisis, in January 2009 decided to raise the required reserve ratios on May 1 and
June 1, 2009, rather than on February 1 and March 1, 2009, as it had planned earlier . At the present time, the
required reserve ratios stand at 0.5% for each category of reservable obligations.
In October 2008, the Bank of Russia added unsecured loans to the set of its monetary policy instruments.
On November 5, it extended the maximum term of these loans to six months for credit institutions rated BB- and
higher by rating agencies Standard & Poor’s and Fitch Ratings and Ba3 and higher by Moody’s Investors Service.
Federal Law No. 317-FZ, dated December 30, 2008, increased the maximum term of unsecured loans to one
year .
T o give Russian credit institutions wider opportunities to manage short-term liquidity in US dollars and
euros, on December 1, 2008, the Bank of Russia began to conclude agreements with credit institutions on the
opening of correspondent accounts in foreign currency.
In October 2008, the Bank of Russia continued to take action to give credit institutions wider access to
its refinancing instruments. Specifically , it eased the requirements for getting funds using some types of col -
lateral: it cancelled the 1.25% discounts for repo operations with federal loan bonds (OFZ) and Bank of Russia
bonds (OBR) and raised the Bank of Russia adjustment ratios used in calculating the value of collateral for Bank
of Russia loans. In addition, it lowered the requirements for the issuer/issue ratings of the bonds put on the
Bank of Russia Lombard List and the rating of enterprises obliged for promissory notes and claims under credit
agreements, accepted as collateral for Bank of Russia loans, by two notches to B-/B3 assigned by Fitch Ratings,
Standard & Poor’s and Moody’s Investors Service. Seeking to facilitate access by credit institutions to refinancing
instruments, the Bank of Russia Board of Directors on February 9, 2009, decided to add to the Bank of Russia
Lombard List shares and bonds of issuers included in the List of Systemically Important Enterprises, if they are
listed at least on one stock exchange in Russia, regardless of whether these issuers have an international rating or
not. The Bank of Russia will conduct repo operations with these papers on the MICEX Stock Exchange.
In October, the Bank of Russia resumed holding 3-month repo auctions and began to hold 3-month Lom-
bard loan auctions. In addition, depending on the situation on the financial markets, the Bank of Russia may hold
from December 12, 2008, 6-month and 12-month repo and Lombard loan auctions. On January 20, 2009,
the Bank of Russia extended up to 365 days the terms of loans extended against the collateral of ‘non-market’
assets.
In the fourth quarter of 2008, the Bank of Rus-
sia extended over 3 trillion roubles in unsecured loans
and in January 2009 it extended 0.5 trillion roubles
in unsecured loans. Most of the loans extended in
the fourth quarter of 2008 and all the loans extend-
ed in January 2009 were extended for a term of 5
weeks and more.
Overall, in October-December 2008, the Bank
of Russia extended 365.4 billion roubles in loans
with terms longer than one month against the collat-
eral of ‘non-market’ assets or guarantees and 18.5
billion roubles in Lombard loans.
In the fourth quarter of 2008, the Bank of
Russia extended at a fixed rate 41.1 billion roubles
in 30-day Lombard loans and 3.8 billion roubles in
loans against the collateral of ‘non-market’ assets.
In all, it injected into credit institutions 414.1 bil -
lion roubles by conducting 1- and 2-week repo op -
erations and extending fixed-rate and auction-based
Lombard loans.
Despite the increase in the volumes of liquidity
provided for terms longer than one month, the Bank
of Russia provided most of the funds to credit insti -
tutions through overnight operations. The volume
1 See Quarterly Inflation Review, 2008 Q3, p. 20.
Monetary Conditions
2008 Q4 21
pansion of the range of their fluctuations. During
the fourth quarter the daily MIACR on overnight
interbank rouble loans varied between 4.6% and
21.5% p.a. (as against 3.4% and 12.6% p.a. in
the third quarter). In January 2009, MIACR on
overnight interbank rouble loans fluctuated be -
tween 5.6% and 28.0% p.a., while the average
monthly rate reached 16.3% p.a., the highest
level since December 2001.
Interest rates on 2- to 7-day interbank rou -
ble loans extended by Russian banks rose from
5.8% p.a. in the third quarter to 9.3% p.a. in the
fourth; interest rates on 8- to 30-day loans went
up from 7.7% to 14.4% p.a.; interest rates on 1-
to 3-month loans increased from 8.6% to 19.5%
p.a. As a result, in the fourth quarter the interbank
credit yield curve moved up considerably and its
slope increased, indicating that Russian money
market participants were expecting growth in in-
terest rates in the short and medium term.
Household deposit rates continued to rise in
the fourth quarter due to the increased competi -
tion on the deposit market amid growth in money
demand and a fairly high inflation rate. The aver -
age short-term rouble deposit rate in the fourth
quarter rose by 1.5 percentage points quarter on
quarter , to 9.0% p.a. The average long-term rou-
ble deposit rate went up by 0.6 percentage points
to 10.0% p.a.
As domestic funds became increasingly ex -
pensive for Russian banks, which had limited ac -
cess to foreign sources of finance, interest rates
on rouble loans to non-financial organisations
continued to rise. The average short-term rate on
loans to non-financial organisations increased by
2.9 percentage points in the fourth quarter , as
of refinancing provided through overnight repo auctions in the fourth quarter of 2008 reached 12.4 trillion
roubles, or 190.1 billion roubles a day on average; 7.4 trillion roubles, or 461.3 billion roubles a day on average,
were provided in January 2009. In October-December 2008, the Bank of Russia provided 80.8 billion roubles
(101.9 billion roubles in January 2009) in fixed-rate overnight loans, 397.5 billion roubles (458.8 billion rou -
bles in January 2009) through repo operations and 15.3 billion roubles in Lombard loans.
Credit institutions also received rouble liquidity through currency swap operations. In the fourth quarter
of 2008, they received 35.4 billion US dollars and 17.9 billion euros through currency swap operations and in
January 2009 credit institutions received 15.6 billion US dollars and 0.6 billion euros through these operations.
As a result, credit institutions’ average daily debt to the Bank of Russia on instruments used to provide li -
quidity increased from 145 billion roubles in the third quarter of 2008 to 1.4 trillion roubles in the fourth and to
3.1 trillion roubles in January 2009. The Bank of Russia average daily debt on instruments used to absorb credit
institutions’ temporarily idle funds stood at about 250 billion roubles in the third quarter of 2008, 310 billion
roubles in the fourth and 157 billion roubles in January 2009.
The aforementioned measures taken by the Bank of Russia helped alleviate the liquidity crunch on the Rus-
sian money market.
22 2008 Q4
compared with the third, and stood at 14.9% p.a.
The average quarterly long-term rate on loans rose
by 0.3 percentage points in that period to 13.8%
p.a. The most significant rise was registered in in-
terest rates on loans with terms of up to 6 months
(about 3.0 percentage points), whereas rates on
loans with terms of over 3 years fell by 0.1 per -
centage points. The yield curve for loans to non-
financial organisations in the fourth quarter re -
tained its rising slope in the up to 6 months sector
but went into decline in the longer-term sector .
Interest rates on rouble-denominated loans
to households and other loans increased in the
fourth quarter . The average quarterly long-term
credit rate gained 1.5 percentage points in that
period quarter on quarter and reached 17.5%
p.a. The average short-term credit rate was up 3.6
percentage points to 26.1% p.a.
Asset prices
Prices continued to fall on the Russian stock
market in the fourth quarter of 2008, due to the
increased capital outflow from the domestic stock
market, the unfavourable situation on the world
financial and raw material market and the depre-
ciation of the rouble against major foreign curren-
cies. Russia’s MICEX and RTS stock market indices
plunged by more than 50% on average quarter
on quarter .
Russian share prices were falling especially
fast in October and their volatility increased sig -
nificantly. In the last week of November the land-
slide stock price downturn had stopped and the
situation somewhat stabilised thanks to active
government support for the stock market. How -
ever , in January 2009 stock prices resumed their
fall due to market participants’ uncertainty about
future share price dynamics. The average monthly
MICEX and RTS stock indices dropped by 1.2%
and 14.1%, respectively , as compared with De-
cember 2008.
The rate of decline in the prices of all corpo -
rate stocks accelerated sharply in the fourth quar-
ter of 2008, as compared with the third. The main
losers (in terms of quarterly averages) were the
machine-building, telecommunications and com-
munications, power and metallurgy companies.
Monetary Conditions
2008 Q4 23
Crisis continues on Russian stock market
The fall in the prices of financial assets on foreign stock markets and the increased capital outflow from
Russia in the fourth quarter of 2008 had a strong destabilising effect on the Russian stock market.
In the fourth quarter of 2008, Russia’s MICEX and RTS stock indices continued to fall rapidly. In the last 10
days of October they hit the lowest level since December 2004. In October and November the Federal Financial
Markets Service repeatedly suspended stock trade on the MICEX Stock Exchange (in the main trading regime)
and in the RTS to prevent prices from falling too much.
In late October, to stabilise the situation on the Russian stock market, the Government allocated funds from
the National Wealth Fund to Vnesheconombank to invest in corporate securities. As a result of massive purchases
by this bank of Russian stocks in secondary exchange trading, the rate of decline in securities prices slowed in
late November and price volatility decreased significantly. On December 31, the MICEX index sank by 39.7% as
compared with September 30 to 619.53 points and the RTS index went down by 47.9% to 631.89 points.
The stock market remained tense in January 2009. For most of the month Russian stock indices were fall-
ing. As a result, in January , as the rouble continued to depreciate, the MICEX and RTS indices, calculated in dif-
ferent currencies (the MICEX index is calculated in roubles and RTS index in US dollars), changed as follows: the
MICEX index gained 0.9%, whereas the RTS index lost 15.3%.
The corporate bond market in the fourth quarter registered a fall in issuer and investor activity as com -
pared with the third quarter . In January 2009, the situation deteriorated, as most of the corporate bond place-
ments were technical. At auctions most of the papers were purchased by a small number of investors. In the
period from October 2008 to January 2009, the supply of corporate bonds by far exceeded demand. In the
fourth quarter scheduled redemptions and payments by tender far surpassed in value the previous quarter’s
levels. Strapped for money , corporate borrowers other than prime borrowers were unable to service their loans.
The number of issuer defaults in the fourth quarter was the largest ever registered on the corporate bond market
(there were 30 defaults in the fourth quarter and only six in the third). In January 2009, the number of issuer
defaults increased as compared with December 2008 (17 defaults and 16 defaults, respectively).
The yields on the most liquid corporate bonds1 in the fourth quarter of 2008 rose sharply quarter on quar-
ter and their volatility increased. The average corporate bond yield was 10.6% p.a. in the third quarter, 19.1%
p.a. in the fourth quarter and 23.6% p.a. in January 2009.
The Finance Ministry made no OFZ placements on the government securities market in the fourth quar-
ter of 2008. In January 2009, it resumed offering government bonds, but there was little demand for them at
auctions at the yields acceptable for the issuer . OFZ secondary trade turnovers were the lowest since August
2006.
1 Corporate and regional bond yields are cited according to data provided by the news agency Cbonds.ru.
24 2008 Q4
As before, it was the prices of the least liquid sec-
ond- and third-tier stocks that fell most rapidly.
January 2009 saw a rise in the prices of
telecommunications, oil and gas and metallurgy
stocks. In the meantime, prices of the power , ma-
chine-building and bank stocks continued to fall
and became even more volatile than in December
2008.
Yields rose on the OFZ market in the fourth
quarter of 2008. At the end of that period the
OFZ effective market portfolio indicator (MPI) in-
creased by 1.2 percentage points quarter on quar-
ter and reached 9.1% p.a. The average quarterly
effective MPI gained 1.2 percentage points and
stood at 8.7% p.a. In January 2009, OFZ yields
varied between 8.8% and 11.2% p.a. By the end
of January , the OFZ effective MPI had risen by 1.1
percentage points month on month and reached
10.3% p.a. The average effective MPI stood at
10.3% p.a. in January.
The OFZ yield curve remained rising in Oc -
tober and November , but in December it sloped
down. The yields on bonds with different maturity
periods changed unevenly. The short- and medi -
um-term OFZ yields grew faster than the yields on
long-term government securities in October and
November . In December , the yield on long-dated
government bonds fell from the previous months’
levels. During the fourth quarter , the inclination of
the yield curve decreased and by the end of De -
cember it had become negative.
Monetary aggregates
The trend towards the reduction of the an -
nual rates of growth in the monetary aggregate
M2 increased in the fourth quarter of 2008 due
to the slowing of growth in money supply and the
significant slowing of growth in money demand.
The slowing of growth in asset prices, the weak -
ening of the rouble, the resumption of dollarisa -
tion, the slowing of economic growth, especially
in the second half of 2008 and persistently high
inflation rates led to the sharp decline of growth in
demand for roubles in the second half of 2008.
As for the regional (sub-federal and municipal) bond market, demand on the primary market was low
in the fourth quarter of 2008 and January 2009. Issuers placed their instruments with a handful of investors
at fairly high yields. Demand and supply on the secondary regional bond market contracted significantly in the
fourth quarter, as compared with the third. In January 2009, secondary regional bond market participants’ activ-
ity continued to decline.
In the period from October 2008 to January 2009, yields on the major regional bond issues rose rapidly.
In November 2008, the range of yield fluctuations of these instruments increased significantly and on January
29, 2009, the regional bond yield reached its historical high of 21.6% p.a. (the highest level since this indicator
began to be calculated in September 2003). The average regional bond yield was 9.3% p.a. in the third quarter,
13.9% p.a. in the fourth quarter and 19.7% p.a. in January 2009.
Monetary Conditions
2008 Q4 25
As the Bank of Russia significantly increased
foreign currency sales on the domestic forex mar-
ket for the purpose of boosting the national cur -
rency in August-December 2008, rouble liquidity
continued to contract and growth in money sup -
ply further slowed.
In the fourth quarter of 2008, the rouble
stock contracted in absolute terms by 6.1% (in
the same period of 2007 it expanded by 15.5%)
and in 2008 as a whole the monetary aggregate
M2 increased by just 1.7%, the smallest growth
in ten years.
The sharp slowing of M2 growth creates con-
ditions for the tightening of monetary conditions,
but the contraction of the rouble supply largely
reflects the significant change in demand for the
national currency due to conversion by economic
agents of their rouble assets into foreign currency
assets. Therefore, the rapid change of preferences
in respect to the asset currency and increased fi -
nancial and general economic uncertainty make it
extremely difficult to evaluate the extent to which
these processes affect aggregate demand and in-
flation.
The monetary aggregate M1, which com -
prises cash and demand deposits, contracted
more than any other monetary aggregate. This
monetary aggregate, which reflects the transac -
tional needs of the economy in money , contracted
by 3.4% in absolute terms in 2008 (in the fourth
quarter it decreased by 5.2%). Demand depos -
its, which are mostly represented by non-financial
organisations’ settlement and current accounts,
contracted by 8.9% in absolute terms in 2008,
whereas in 2007 they increased by 52%.
Banking sector instability , the depreciation
of the rouble against the dollar and the euro and
general macroeconomic uncertainty provoked a
sharp rise in household demand for foreign ex -
change, which led to the slowing of growth in the
monetary aggregate M0. In the fourth quarter of
26 2008 Q4
long-term deposits. As a result, the value of
household deposits decreased by 3.4% in 2008,
whereas 2007 showed a growth of 41.3%. The
share of household time deposits in M2 contract-
ed in October-December 2008 to a three-year
low of 26%. The main reason for the outflow of
funds from rouble deposits was the substantial
depreciation of the rouble against the US dollar
and the euro.
The share of household rouble time deposits
in money income contracted sharply in the fourth
quarter of 2008, as public propensity to save in
roubles decreased amid widespread uncertainty
and the evolving exchange rate dynamics. At the
same time, the share of foreign currency depos -
2008, net sales of foreign exchange to households
reached an all-time record high of about $30 bil-
lion. The monetary aggregate M0 contracted by
2.8% in that period in absolute terms, whereas in
the previous years the fourth quarter saw signifi -
cant seasonal growth in cash. Overall, in 2008 the
monetary aggregate M0 increased by 2.5%.
Despite the rise in interest rates, the value of
rouble time deposits decreased by 7.4% in abso-
lute terms in the fourth quarter of 2008. As a re -
sult, growth in this type of deposits slowed signifi-
cantly in 2008, to 9.7% from 55.8% in 2007.
Household rouble deposits contracted the
most in absolute terms (by 14.2%) in the fourth
quarter , a process that affected both short- and
Monetary Conditions
2008 Q4 27
was largely caused by the sharp depreciation of
the exchange rate of the rouble and, as a conse -
quence, the expansion of foreign currency credit
in rouble terms. The slowing of the annual rate of
growth in foreign currency-denominated loans in
dollar terms was more significant.
The main factors behind the dynamics of
credit aggregates in the fourth quarter of 2008
were the increased cost of borrowing and the im-
paired solvency of borrowers amid the deteriora -
tion of the general macroeconomic situation. This
process found its expression in the sharp increase
in the share of overdue debt in total loans extend-
ed in the second half of 2008. Another important
factor that affected credit aggregate dynamics
its in household money income expanded signifi-
cantly.
The fourth-quarter rouble exchange rate
dynamics caused not only growth in household
demand for foreign exchange, but also rapid in -
crease in foreign currency deposits. In October-
December 2008, the total value of non-financial
organisation and household foreign currency de -
posits in dollar terms increased by more than 60%
(40% growth was registered in December) and in
2008 as a whole it almost doubled.
Credit aggregates
Growth in loans to non-financial organisa -
tions and households slowed down significantly
in the fourth quarter of 2008. As of January 1,
2009, the annual rate of growth in total payables
decreased to 34.5% from 53% a year earlier .
The slowdown of growth in rouble credit ag-
gregates was most significant. In the non-finan -
cial organisation sector the annual rate of growth
slowed down from 54.8% as of January 1, 2008,
to 28.5% as of January 1, 2009 (loan debt con -
tracted in absolute terms in November) and in the
household sector from 62.6% to 37.8% (debt
contracted in absolute terms in November and
December).
Growth in foreign currency credit aggre -
gates (in rouble terms) slowed less than that of
rouble credits. In the household sector it slowed
from 33% to 18.7% in 2008, whereas in the
non-financial organisation sector it accelerated
from 42.9% to 51%. This dynamics, however ,
28 2008 Q4
was the increased risks involved in the exchange
rate dynamics. Firstly , as the devaluation expecta-
tions persisted, banks avoided creating assets de-
nominated in roubles. Secondly , the conversion of
funds into foreign exchange by economic agents
narrowed the rouble deposit base and this also
contributed to the reduction of the rouble credit
supply. In addition, borrowers reduced demand
for foreign currency loans in a bid to avoid ex -
change rate risk.
The first to feel the credit crunch were enter-
prises in the sectors that were the hardest hit by
the financial crisis. These are, above all, the con -
struction sector and the mining industry.
Overall, the current dynamics of credit aggre-
gates reflects the changes that took place in the
general economic trends, including global ones,
in 2008. The positive phase of the economic cy -
cle, which was characterised by the acceleration
of economic growth, high asset prices and rapid
expansion of payables, had reached the highest
point in the middle of 2007. The second half of
2008 saw a significant decline in business activ -
ity that followed the slowing of growth in credit
aggregates and the slowing of growth in asset
prices, which began in late 2007. Therefore, the
credit aggregate dynamics allows one to conclude
that the situation on the credit markets has dete -
riorated dramatically and this may become a seri-
ous obstacle to rapid recovery of macroeconomic
indicator dynamics to the 2006-2007 levels.
2008 Q4 29
Statistical Addendum
Table 1
Consumer prices by group of goods and services
(month on month, %)
Monthly
inflation
Core
inflation
Food price
growth
Food price
growth 1
Vegetable
and fruit price
growth
Non-food
price growth
Growth in non-
food prices,
excluding petrol
prices 2
Service price
growth
January 2.4 0.8 2.0 1.0 11.3 0.4 0.5 6.2
February 1.7 1.2 3.0 1.9 12.6 0.5 0.5 1.0
March 0.8 0.7 1.2 0.9 3.2 0.4 0.4 0.7
April 0.4 0.4 0.3 0.3 -0.3 0.3 0.3 0.6
May 0.5 0.4 0.5 0.2 2.6 0.4 0.4 0.6
June 0.3 0.3 0.0 0.1 -0.6 0.3 0.3 0.7
July 0.7 0.5 0.9 0.7 2.7 0.4 0.3 0.6
August 0.2 0.6 -0.5 0.7 -10.0 0.8 0.5 0.8
September 0.1 0.8 -0.6 0.6 -11.0 0.8 0.6 0.5
October 0.3 0.5 0.0 0.4 -4.1 0.6 0.7 0.4
November 0.6 0.6 0.8 0.6 2.7 0.6 0.6 0.5
December 0.8 0.7 1.1 0.8 3.6 0.5 0.5 0.7
Full year (December on December) 9.0 7.8 8.7 8.5 10.3 6.0 5.7 13.9
January 1.7 0.6 0.9 0.6 4.1 0.4 0.4 4.7
February 1.1 0.5 0.8 0.5 3.6 0.3 0.4 2.6
March 0.6 0.5 0.8 0.5 3.2 0.4 0.4 0.6
April 0.6 0.5 0.8 0.5 3.1 0.4 0.4 0.5
May 0.6 0.3 1.0 0.1 7.8 0.4 0.3 0.5
June 1.0 0.4 1.7 0.4 12.2 0.3 0.3 0.6
July 0.9 0.9 1.4 1.4 1.9 0.4 0.4 0.6
August 0.1 1.1 -0.6 1.6 -16.1 0.6 0.5 0.5
September 0.8 1.6 1.0 2.2 -8.8 0.8 0.8 0.4
October 1.6 2.1 3.3 3.5 0.9 0.9 0.9 0.1
November 1.2 1.1 1.9 1.5 6.2 0.9 0.8 0.6
December 1.1 0.9 1.6 1.2 5.6 0.7 0.5 0.9
Full year (December on December) 11.9 11.0 15.6 14.9 22.2 6.5 6.4 13.3
January 2.3 1.1 1.9 1.2 8.3 0.6 0.6 5.4
February 1.2 1.0 1.7 1.3 5.1 0.6 0.6 1.4
March 1.2 1.1 2.0 1.5 5.9 0.7 0.7 0.6
April 1.4 1.3 2.2 1.8 5.5 0.9 0.7 1.0
May 1.4 1.1 2.1 1.5 6.4 0.8 0.6 1.0
June 1.0 0.9 1.1 1.2 0.4 0.7 0.5 1.1
July 0.5 0.8 0.1 1.0 -6.7 0.7 0.5 0.9
August 0.4 1.0 -0.2 1.2 -11.3 0.6 0.6 0.9
September 0.8 1.4 0.7 1.5 -6.4 0.7 0.8 1.0
October 0.9 1.3 1.6 1.8 -0.4 0.8 1.0 0.0
November 0.8 1.1 1.3 1.3 1.0 0.5 0.9 0.7
December 0.7 0.8 1.0 1.0 1.7 0.1 0.6 1.0
Full year (December on December) 13.3 13.6 16.5 17.5 7.7 8.0 8.4 15.9
1 Excluding vegetables and fruit.
2 Since March 2005 – Bank of Russia estimate.
Note. T ables 1 to 7 are based on Rosstat data and Bank of Russia calculations.
30 2008 Q4
Table 2
Consumer prices by group of goods and services
(since start of year on accrual basis, %)
Monthly
inflation
Core
inflation
Food price
growth
Food price
growth 1
Vegetable
and fruit price
growth
Non-food
price growth
Growth in non-
food prices,
excluding petrol
prices 2
Service price
growth
January 2.4 0.8 2.0 1.0 11.3 0.4 0.5 6.2
February 4.1 2.0 5.0 2.9 25.3 0.9 0.9 7.2
March 5.0 2.8 6.2 3.9 29.3 1.3 1.3 8.0
April 5.4 3.2 6.5 4.2 28.9 1.6 1.6 8.6
May 5.9 3.6 7.0 4.4 32.3 2.0 2.0 9.3
June 6.2 3.9 7.0 4.5 31.5 2.3 2.3 10.0
July 6.9 4.5 8.0 5.2 35.0 2.7 2.7 10.7
August 7.1 5.1 7.4 6.0 21.6 3.5 3.2 11.5
September 7.2 5.9 6.7 6.6 8.2 4.3 3.8 12.0
October 7.5 6.5 6.7 7.0 3.7 5.0 4.5 12.5
November 8.2 7.1 7.5 7.6 6.5 5.5 5.2 13.0
December 9.0 7.8 8.7 8.5 10.3 6.0 5.7 13.9
January 1.7 0.6 0.9 0.6 4.1 0.4 0.4 4.7
February 2.8 1.1 1.8 1.1 7.8 0.7 0.8 7.4
March 3.4 1.7 2.6 1.7 11.2 1.1 1.2 8.0
April 4.0 2.2 3.3 2.1 14.7 1.5 1.7 8.6
May 4.7 2.5 4.3 2.3 23.6 1.9 2.0 9.1
June 5.7 3.0 6.1 2.7 38.6 2.2 2.3 9.8
July 6.6 3.9 7.6 4.1 41.2 2.6 2.8 10.5
August 6.7 5.0 7.0 5.8 18.5 3.2 3.3 11.1
September 7.5 6.7 8.1 8.1 8.1 4.0 4.2 11.6
October 9.3 8.9 11.6 11.9 9.0 4.9 5.1 11.7
November 10.6 10.1 13.7 13.5 15.7 5.8 5.9 12.4
December 11.9 11.0 15.6 14.9 22.2 6.5 6.4 13.3
January 2.3 1.1 1.9 1.2 8.3 0.6 0.6 5.4
February 3.5 2.1 3.6 2.5 13.9 1.2 1.2 6.8
March 4.8 3.2 5.7 4.0 20.6 2.0 1.9 7.5
April 6.3 4.5 8.0 5.9 27.2 2.9 2.6 8.5
May 7.7 5.7 10.2 7.5 35.4 3.7 3.2 9.6
June 8.7 6.7 11.4 8.7 36.0 4.4 3.7 10.8
July 9.3 7.6 11.5 9.8 26.9 5.2 4.2 11.9
August 9.7 8.6 11.3 11.2 12.5 5.8 4.9 12.9
September 10.6 10.1 12.1 12.9 5.3 6.5 5.7 14.0
October 11.6 11.5 13.9 14.9 4.8 7.3 6.8 14.1
November 12.5 12.7 15.3 16.3 5.9 7.8 7.8 14.8
December 13.3 13.6 16.5 17.5 7.7 8.0 8.4 15.9
1 Excluding vegetables and fruit.
2 Since March 2005 – Bank of Russia estimate.
Statistical Addendum
2008 Q4 31
Table 3
Consumer prices by group of goods and services
(month on corresponding month of previous year, %)
Monthly
inflation
Core
inflation
Food price
growth
Food price
growth 1
Vegetable
and fruit price
growth
Non-food
price growth
Growth in non-
food prices,
excluding petrol
prices 2
Service price
growth
January 10.7 8.2 10.2 9.1 21.1 6.5 6.0 18.1
February 11.2 8.7 11.9 10.1 28.4 6.6 6.1 16.7
March 10.6 8.7 10.9 10.0 19.2 6.7 6.1 16.1
April 9.8 8.2 9.4 9.0 12.7 6.4 6.0 15.9
May 9.4 7.9 8.7 8.5 11.1 6.4 6.0 15.6
June 9.0 7.8 8.0 8.1 7.0 6.4 6.0 15.3
July 9.3 7.8 8.7 8.3 11.9 6.3 5.9 15.0
August 9.6 7.9 9.2 8.5 15.6 6.6 6.0 15.0
September 9.5 7.9 9.3 8.5 16.4 6.2 5.8 14.5
October 9.2 7.8 8.8 8.3 14.4 6.1 5.7 14.1
November 9.0 7.8 8.7 8.3 12.4 6.0 5.7 13.9
December 9.0 7.8 8.7 8.5 10.3 6.0 5.7 13.9
January 8.2 7.7 7.6 8.0 3.1 6.0 5.7 12.3
February 7.6 6.9 5.3 6.6 -5.1 5.8 5.6 14.2
March 7.4 6.7 4.9 6.2 -5.2 5.8 5.6 14.0
April 7.6 6.8 5.4 6.3 -1.9 5.9 5.8 13.9
May 7.8 6.7 5.9 6.3 3.0 5.9 5.7 13.8
June 8.5 6.9 7.7 6.6 16.2 5.9 5.7 13.7
July 8.7 7.3 8.3 7.4 15.3 5.9 5.8 13.7
August 8.6 7.8 8.3 8.3 7.5 5.7 5.8 13.4
September 9.4 8.7 10.0 10.0 10.2 5.8 6.1 13.4
October 10.8 10.3 13.6 13.4 15.9 6.0 6.3 13.1
November 11.5 10.9 14.9 14.4 19.8 6.3 6.4 13.2
December 11.9 11.0 15.6 14.9 22.2 6.5 6.4 13.3
January 12.6 11.5 16.7 15.7 27.2 6.8 6.6 14.1
February 12.7 12.1 17.6 16.5 29.1 7.0 6.8 12.7
March 13.3 12.7 19.1 17.6 32.6 7.4 7.1 12.7
April 14.3 13.5 20.8 19.1 35.6 8.0 7.4 13.3
May 15.1 14.5 22.1 20.8 33.9 8.4 7.7 13.9
June 15.1 15.1 21.3 21.7 19.9 8.9 7.9 14.4
July 14.7 15.0 19.8 21.2 9.8 9.2 8.0 14.7
August 15.0 14.8 20.2 20.8 16.1 9.2 8.1 15.2
September 15.0 14.5 19.9 20.0 19.0 9.1 8.1 15.9
October 14.2 13.7 17.9 18.0 17.5 9.1 8.2 15.7
November 13.8 13.7 17.2 17.7 11.9 8.6 8.4 15.8
December 13.3 13.6 16.5 17.5 7.7 8.0 8.4 15.9
1 Excluding vegetables and fruit.
2 Since March 2005 – Bank of Russia estimate.
32 2008 Q4
Table 4
Inflation growth over period since start of year due to price changes
by group of goods and services (percentage points)
Foodstuffs 1 Non-food
products
Paid
services
Vegetables and
fruit
Inflation over
period, %
Core
inflation
Non-core
inflation 2
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
July 2.0 0.9 2.5 1.4 6.9 3.4 3.5
August 2.3 1.2 2.7 0.9 7.1 3.9 3.2
September 2.6 1.5 2.9 0.3 7.2 4.6 2.6
October 2.7 1.7 3.0 0.1 7.5 5.0 2.5
November 3.0 1.9 3.1 0.3 8.2 5.5 2.7
December 3.3 2.0 3.3 0.4 9.0 6.1 3.0
January 0.2 0.1 1.2 0.2 1.7 0.5 1.2
February 0.4 0.3 1.8 0.3 2.8 0.9 1.9
March 0.6 0.4 2.0 0.4 3.4 1.3 2.1
April 0.8 0.5 2.1 0.6 4.0 1.7 2.3
May 0.8 0.7 2.3 0.9 4.7 1.9 2.7
June 1.0 0.8 2.4 1.5 5.7 2.3 3.4
July 1.5 0.9 2.6 1.6 6.6 3.0 3.6
August 2.1 1.1 2.7 0.7 6.7 3.9 2.8
September 3.0 1.4 2.9 0.3 7.5 5.3 2.3
October 4.3 1.7 2.9 0.3 9.3 7.0 2.3
November 4.9 2.0 3.1 0.6 10.6 7.9 2.7
December 5.4 2.3 3.3 0.9 11.9 8.7 3.2
January 0.4 0.2 1.3 0.3 2.3 0.8 1.5
February 0.9 0.4 1.7 0.5 3.5 1.6 1.9
March 1.4 0.7 1.9 0.8 4.8 2.5 2.3
April 2.1 1.0 2.1 1.0 6.3 3.6 2.7
May 2.6 1.3 2.4 1.4 7.7 4.5 3.2
June 3.1 1.6 2.7 1.4 8.7 5.3 3.5
July 3.5 1.9 3.0 1.0 9.3 6.0 3.3
August 3.9 2.1 3.2 0.5 9.7 6.8 2.9
September 4.5 2.3 3.5 0.2 10.6 8.0 2.6
October 5.2 2.6 3.5 0.2 11.6 9.2 2.4
November 5.8 2.8 3.7 0.2 12.5 10.1 2.4
December 6.2 2.9 4.0 0.3 13.3 10.8 2.5
1 Excluding vegetables and fruit.
2 Growth in prices of goods and paid services not included in the calculation of the core consumer price index.
Statistical Addendum
2008 Q4 33
Table 5
Monthly inflation growth due to price changes
by group of goods and services (percentage points)
Foodstuffs 1 Non-food
products
Paid
services
Vegetables
and fruit
Inflation over
period, %
Core
inflation
Non-core
inflation 2
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
July 0.3 0.1 0.2 0.1 0.7 0.4 0.3
August 0.3 0.2 0.2 -0.5 0.2 0.5 -0.3
September 0.2 0.3 0.1 -0.5 0.1 0.6 -0.5
October 0.1 0.2 0.1 -0.2 0.3 0.4 -0.1
November 0.2 0.2 0.1 0.1 0.6 0.5 0.2
December 0.3 0.1 0.2 0.1 0.8 0.5 0.3
January 0.2 0.1 1.2 0.2 1.7 0.5 1.2
February 0.2 0.1 0.7 0.1 1.1 0.4 0.7
March 0.2 0.1 0.1 0.1 0.6 0.4 0.2
April 0.2 0.1 0.1 0.1 0.6 0.4 0.2
May 0.1 0.1 0.1 0.3 0.6 0.2 0.4
June 0.2 0.1 0.2 0.6 1.0 0.3 0.6
July 0.5 0.1 0.2 0.1 0.9 0.7 0.2
August 0.6 0.2 0.1 -0.8 0.1 0.8 -0.7
September 0.8 0.3 0.1 -0.4 0.8 1.3 -0.5
October 1.3 0.3 0.0 0.0 1.6 1.6 0.0
November 0.5 0.3 0.2 0.2 1.2 0.8 0.4
December 0.5 0.2 0.2 0.2 1.1 0.7 0.5
January 0.4 0.2 1.3 0.3 2.3 0.8 1.5
February 0.4 0.2 0.3 0.2 1.2 0.8 0.4
March 0.5 0.3 0.2 0.3 1.2 0.8 0.3
April 0.6 0.3 0.3 0.2 1.4 1.0 0.4
May 0.5 0.3 0.3 0.3 1.4 0.9 0.5
June 0.4 0.3 0.3 0.0 1.0 0.7 0.2
July 0.4 0.2 0.2 -0.3 0.5 0.7 -0.1
August 0.4 0.2 0.2 -0.5 0.4 0.8 -0.4
September 0.5 0.2 0.3 -0.3 0.8 1.1 -0.3
October 0.6 0.3 0.0 0.0 0.9 1.1 -0.2
November 0.5 0.2 0.2 0.0 0.8 0.8 0.0
December 0.4 0.0 0.2 0.1 0.7 0.6 0.1
1 Excluding vegetables and fruit.
2 Growth in prices of goods and paid services not included in the calculation of the core consumer price index.
34 2008 Q4
Table 6
Contribution to inflation growth over period since start of year
by group of goods and services (%)
Foodstuffs 1 Non-food products Paid services Vegetables and fruit Core inflation Non-core inflation 2
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
July 29.6 13.5 36.7 20.2 49.7 50.3
August 32.7 16.8 38.5 12.1 55.4 44.6
September 35.7 20.2 39.6 4.5 63.4 36.6
October 36.3 22.4 39.4 2.0 66.7 33.3
November 36.2 22.9 37.8 3.2 67.3 32.7
December 36.5 22.5 36.4 4.5 67.1 32.9
January 13.4 8.3 69.0 9.3 29.5 70.5
February 14.9 9.2 65.3 10.6 31.3 68.7
March 17.8 11.6 58.1 12.5 38.3 61.7
April 19.6 13.5 52.9 14.1 42.8 57.2
May 18.0 14.3 48.3 19.4 41.6 58.4
June 17.6 13.7 42.7 26.0 40.4 59.6
July 22.9 13.9 39.2 23.9 45.8 54.2
August 31.7 16.9 40.8 10.6 58.5 41.5
September 39.3 18.7 37.9 4.1 69.9 30.1
October 46.6 18.6 31.1 3.7 75.4 24.6
November 46.3 19.2 28.8 5.7 74.5 25.5
December 45.7 19.4 27.8 7.2 72.8 27.2
January 18.9 9.3 58.1 13.7 36.2 63.8
February 25.1 12.1 47.9 14.9 46.1 53.9
March 29.7 14.7 39.0 16.6 52.7 47.3
April 33.0 16.5 33.9 16.6 57.0 43.0
May 34.2 17.1 31.1 17.6 58.5 41.5
June 35.2 18.2 30.8 15.7 60.5 39.5
July 37.3 19.9 31.7 11.1 64.4 35.6
August 40.6 21.4 33.0 5.0 70.5 29.5
September 43.0 22.0 33.1 1.9 75.7 24.3
October 45.3 22.9 30.2 1.6 79.2 20.8
November 46.0 22.6 29.6 1.8 80.8 19.2
December 46.4 21.6 29.8 2.2 81.5 18.5
1 Excluding vegetables and fruit.
2 Growth in prices of goods and paid services not included in the calculation of the core consumer price index.
Statistical Addendum
2008 Q4 35
Table 7
Contribution to monthly inflation growth
by group of goods and services (%)
Foodstuffs 1 Non-food products Paid services Vegetables and fruit Core inflation Non-core inflation 2
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
July 37.6 19.0 23.4 20.0 60.9 39.1
August 140.5 132.4 97.9 -270.7 249.5 -149.5
September 269.8 290.1 128.8 -588.7 678.9 -578.9
October 51.0 73.9 34.6 -59.5 145.8 -45.8
November 34.7 29.1 19.3 16.9 74.1 25.9
December 39.6 19.0 23.2 18.2 64.4 35.6
January 13.4 8.3 69.0 9.3 29.5 70.5
February 17.1 10.6 59.7 12.6 34.2 65.8
March 31.4 22.7 24.5 21.4 70.7 29.3
April 30.0 24.6 22.3 23.1 69.6 30.4
May 8.4 19.5 20.6 51.6 34.4 65.6
June 15.8 10.7 17.0 56.5 35.1 64.9
July 55.9 15.7 17.4 10.9 79.2 20.8
August 724.2 250.9 165.2 -1,040.4 1,016.5 -916.5
September 99.9 33.4 14.7 -48.0 160.7 -60.7
October 78.5 18.2 1.2 2.1 99.3 0.7
November 43.6 23.6 13.3 19.5 67.8 32.2
December 39.2 21.6 19.2 20.0 56.7 43.3
January 18.9 9.3 58.1 13.7 36.2 63.8
February 36.8 17.4 28.5 17.3 64.9 35.1
March 43.2 22.6 12.8 21.4 72.2 27.8
April 43.5 22.0 17.6 16.9 70.3 29.7
May 39.1 20.1 18.9 21.9 65.2 34.8
June 42.7 26.5 28.7 2.2 74.5 25.5
July 69.6 47.5 45.8 -62.9 125.6 -25.6
August 122.9 59.3 67.5 -149.7 225.0 -125.0
September 69.7 29.4 34.5 -33.6 136.6 -36.6
October 69.5 32.2 -0.1 -1.7 116.9 -16.9
November 54.4 19.8 21.2 4.7 100.5 -0.5
December 50.8 5.9 34.3 8.9 91.7 8.3
1 Excluding vegetables and fruit.
2 Growth in prices of goods and services not included in the calculation of the core consumer price index.
36 2008 Q4
Year Q1 Q2 Q3 Q4
Macroeconomic indicators
GDP
over period since start of year, billion roubles
2006 5,845 12,206 19,487 26,904
2007 6,748 14,497 23,324 33,114
2008 8,838 19,113 30,760 41,540
over period since start of year, as % of corresponding period of previous
year
2006 106.3 106.9 1 107.1 1 107.7
2007 107.4 107.8 107.6 108.1
2008 108.5 108.0 107.3 105.6
as % of corresponding quarter of previous year
2006 106.3 107.4 107.5 108.0
2007 107.4 108.1 107.3 109.5
2008 108.5 107.5 106.2
Industrial output indices
as % of corresponding quarter of previous year
2006 104.1 106.6 106.9 107.5
2007 107.2 107.1 105.5 105.7
2008 106.2 105.5 104.7 93.9
over period since start of year, as % of corresponding period of previous
year
2006 104.1 105.3 105.9 106.3
2007 107.2 107.1 106.6 106.3
2008 106.2 105.8 105.4 102.1
Agricultural output
as % of corresponding quarter of previous year
2006 102.1 101.8 101.4 110.4
2007 103.5 104.4 103.2 103.2
2008 105.5 106.9 113.0 115.6
over period since start of year, as % of corresponding period of previous
year
2006 102.1 101.9 101.6 103.6
2007 103.5 104.1 103.5 103.4
2008 105.5 106.4 109.6 110.8
Fixed capital investment
over period since start of year, billion roubles
2006 658.4 1,676.0 2,963.3 4,730.0
2007 916.6 2,365.7 4,129.3 6,626.8
2008 1,295.9 3,256.1 5,598.7 8,606.7
as % of corresponding quarter of previous year
2006 108.8 117.7 116.1 120.3
2007 122.8 124.2 118.2 120.6
2008 119.1 113.0 109.8 101.8
Retail trade turnover
over period since start of year, billion roubles
2006 1,857.2 3,925.3 6,162.6 8,711.9
2007 2,257.3 4,799.2 7,597.6 10,866.2
2008 2,938.4 6,248.5 9,888.7 13,853.2
as % of corresponding quarter of previous year
2006 111.4 113.6 115.3 115.3
2007 114.7 115.7 116.7 116.7
2008 116.7 114.4 114.5 108.2
Federal budget on accrual
basis, as of end of period
revenue
billion roubles
2006 1,399.1 2,938.1 4,561.0 6,278.9
2007 1,421.9 3,245.7 5,087.6 7,781.1
2008 1,932.7 4,370.7 7,155.7 9,274.1
as % of GDP
2006 24.0 24.1 23.4 23.3
2007 21.1 22.4 21.8 23.5
2008 21.9 22.9 23.3 22.3
expenditure
billion roubles
2006 823.2 1,854.7 2,866.5 4,284.8
2007 945.6 2,169.7 3,464.3 5,986.6
2008 1,332.7 2,995.6 4,594.2 7,566.6
as % of GDP
2006 14.1 15.2 14.7 15.9
2007 14.0 15.0 14.8 18.1
2008 15.1 15.7 15.0 18.2
Federal budget surplus on accrual basis,
as of end of period
billion roubles
2006 575.9 1,083.4 1,694.6 1,994.1
2007 476.3 1,076.1 1,623.2 1,794.6
2008 600.0 1,375.1 2,561.5 1,707.5
as % of GDP
2006 9.9 8.9 8.7 7.4
2007 7.1 7.4 7.0 5.4
2008 6.8 7.2 8.3 4.1
Table 8
Russia’s key macroeconomic and financial indicators
Note. T able 8 is based on data compiled by the Bank of Russia, Federal State Statistics Service and Federal T reasury. From April
2006, pursuant to Bank of Russia Ordinance No. 1660-U, dated February 17, 2006, the calculation of interest rates on bank
lending and deposit operations includes data reported by bank branches.
Statistical Addendum
2008 Q4 37
Year Q1 Q2 Q3 Q4
Socio-economic indicators
Nominal imputed average
monthly per employee wage
roubles
2006 9,397 10,401 10,949 12,203
2007 11,876 12,993 13,494 15,742
2008 15,424 16,962 17,556 18,528
as % of corresponding quarter of previous year
2006 122.3 125.1 125.1 125.2
2007 127.3 125.9 124.0 129.3
2008 128.0 129.2 129.0 116.6
over period since start of year, as % of corresponding period of previous
year
2006 122.3 123.7 124.1 124.3
2007 127.3 126.6 125.7 127.8
2008 128.0 128.6 128.7 125.2
Real imputed average monthly per employee wage, as % of corresponding quarter of previous year
2006 110.3 114.3 114.3 114.8
2007 118.2 116.6 113.9 116.1
2008 113.4 112.5 112.2 102.5
Household money income (per capita monthly average), roubles
2006 8,200.0 9,933.9 10,253.3 12,316.8
2007 9,975.5 11,986.2 12,724.1 15,675.9
2008 12,345.0 14,842.7 15,837.9 17,396.6
Household real disposable
money income
as % of corresponding quarter of previous year
2006 109.9 115.5 114.5 113.7
2007 111.9 110.0 112.4 113.0
2008 107.8 106.0 106.0 94.2
over period since start of year, as % of corresponding period of previous
year
2006 109.9 … … 113.5
2007 111.9 110.8 111.4 112.1
2008 107.8 106.9 106.6 102.7
Household spending, as % of
income
purchase of goods and services
2006 73.1 67.7 71.0 65.6
2007 73.6 67.7 71.2 66.0
2008 76.5 71.6 73.4 71.8
compulsory payments and contributions
2006 10.8 10.3 10.4 10.5
2007 12.0 11.9 11.6 11.6
2008 12.7 12.5 12.7 14.0
growth in savings
2006 11.1 10.7 8.3 11.3
2007 10.2 9.0 8.1 11.0
2008 7.7 8.2 5.8 3.0
purchase of foreign exchange
2006 7.4 7.0 7.2 6.0
2007 5.2 5.2 5.2 5.1
2008 6.9 4.7 5.6 13.4
cash on hand
2006 -2.5 4.3 3.2 6.7
2007 -1.0 4.6 3.9 6.3
2008 -3.8 3.0 2.5 -2.2
Average imputed pension, total, roubles
2006 2,539 2,727 2,800 2,839
2007 2,846 3,091 3,108 3,418
2008 3,823 4,044 4,383 4,545
Real imputed pension
as % of corresponding quarter of previous year
2006 107.8 107.2 103.7 102.5
2007 104.1 104.9 102.0 108.1
2008 119.0 113.9 122.7 116.9
over period since start of year, as % of corresponding period of previous
year
2006 107.8 107.5 106.1 105.1
2007 104.1 104.5 103.6 104.8
2008 119.0 116.4 118.6 118.1
Total number of unemployed
(calculated using ILO
methodology)
million
2006 5.7 5.5 5.0 5.0
2007 5.2 4.5 4.3 4.4
2008 5.1 4.3 4.5 5.4
as % of economically active population
2006 7.8 7.4 6.7 6.8
2007 7.0 6.0 5.7 5.8
2008 6.7 5.6 5.9 7.1
Table 8 (continued)
38 2008 Q4
Year Q1 Q2 Q3 Q4
Foreign economic activities
Price of Urals crude
over period since start of year, $/barrel
2006 57.7 61.1 62.5 60.9
2007 54.0 59.7 64.0 69.5
2008 93.7 105.3 107.6 93.9
as % of corresponding period of previous year
2006 134.0 134.7 126.7 120.9
2007 93.5 97.7 102.4 114.1
2008 173.7 176.3 168.2 135.1
Exports of goods
over period since start of year, $ billion
2006 67.3 143.9 223.7 303.6
2007 71.7 155.4 244.9 354.4
2008 110.1 236.8 373.7 469.0
as % of corresponding period of previous year
2006 134.1 131.1 128.1 124.5
2007 106.5 108.0 109.5 116.8
2008 153.6 152.4 152.6 132.3
Imports of goods
over period since start of year, $ billion
2006 30.9 69.7 112.3 164.3
2007 42.8 95.5 153.9 223.5
2008 60.2 135.4 219.3 292.5
as % of corresponding period of previous year
2006 120.1 126.4 128.2 131.0
2007 138.6 137.1 137.0 136.0
2008 140.7 141.7 142.5 130.9
Current account (over period since start of year), $ billion
2006 30.4 54.7 78.6 94.3
2007 22.4 36.8 52.3 76.2
2008 37.4 63.2 90.8 98.9 1
Private sector net capital outflow (inflow) (over period since start of year), $ billion
2006 -5.6 15.0 27.4 41.8
2007 13.9 68.4 61.4 83.1
2008 -23.1 18.0 0.6 -129.9 1
Foreign investment in non-financial sector
(according to Rosstat data)
over period since start of year, $ billion
2006 8.8 23.4 35.3 55.1
2007 24.6 60.3 87.9 120.9
2008 17.3 46.5 75.8
as % of corresponding period of previous year
2006 146.0 141.9 131.7 102.7
2007 2.8 times 2.6 times 2.5 times 2.2 times
2008 70.1 77.1 86.2
of which:
direct
over period since start of year, $ billion
2006 3.8 6.4 10.3 13.7
2007 9.8 15.8 19.6 27.8
2008 5.6 11.1 19.2
as % of corresponding period of previous year
2006 2.0 times 143.6 155.5 104.6
2007 2.5 times 2.5 times 191.3 2.0 times
2008 57.2 70.0 97.7
portfolio
over period since start of year, $ billion
2006 0.2 0.5 0.7 3.2
2007 0.2 1.1 1.5 4.2
2008 0.1 1.2 1.3
as % of corresponding period of previous year
2006 2.9 times 2.9 times 182.3 7.0 times
2007 85.8 2.2 times 2.3 times 131.8
2008 62.5 104.4 83.7
other
over period since start of year, $ billion
2006 4.7 16.5 24.4 38.2
2007 14.7 43.4 66.7 89.0
2008 11.5 34.3 55.3
as % of corresponding period of previous year
2006 117.2 139.1 122.8 95.3
2007 3.1 times 2.6 times 2.7 times 2.3 times
2008 78.7 79.0 82.8
Russia’s international reserves (as of end of period), $ billion
2006 205.9 250.6 266.2 303.7
2007 338.8 405.8 425.4 478.8
2008 2 512.6 569.0 556.8 427.1
Real rouble exchange rate indices, last month of
quarter (growth as % of December of previous
year) 3
rouble vs. US dollar
2006 6.9 10.0 12.1 16.7
2007 2.3 3.8 8.1 15.0
2008 6.5 8.5 3.2 -1.1
rouble vs. euro
2006 6.5 4.9 6.0 5.6
2007 3.1 4.1 4.5 5.8
2008 0.6 3.4 6.2 5.0
effective rate
2006 6.2 7.0 7.9 7.4
2007 2.7 3.3 3.8 5.1
2008 1.5 3.3 3.0 4.3
Table 8 (continued)
Statistical Addendum
2008 Q4 39
Year Q1 Q2 Q3 Q4
Financial market indicators (including Sberbank rates)
Average for period
Overnight interbank credit
rate, % p.a.
in roubles
2006 3.2 2.8 2.6 5.1
2007 3.9 3.4 4.9 5.4
2008 3.9 4.1 6.0 8.6
in US dollars
2006 4.4 4.8 5.2 5.2
2007 5.2 5.2 5.1 4.5
2008 3.2 2.2 2.2 0.7
OFZ yields 4, % p.a.
2006 6.8 6.9 6.8 6.7
2007 6.6 6.6 6.6 6.6
2008 6.7 6.9 7.5 8.7
Interest rate on household
time deposits, % p.a.
up to 1 year in roubles
2006 8.3 7.9 7.6 7.7
2007 7.4 7.3 7.0 7.2
2008 7.0 7.1 7.5 9.0
over 1 year in roubles
2006 7.6 5.2 5.2 5.4
2007 7.9 7.5 7.1 6.8
2008 7.4 8.0 8.5 9.1
up to 1 year in US dollars
2006 5.6 5.7 5.7 5.9
2007 5.4 5.3 5.2 5.2
2008 5.1 5.8 5.3 6.5
over 1 year in US dollars
2006 6.2 4.6 5.0 5.5
2007 6.8 6.6 6.4 7.0
2008 6.9 7.0 7.1 7.8
Interest rate on credit to non-
financial organisations, % p.a.
up to 1 year in roubles
2006 10.4 10.6 10.3 10.4
2007 9.9 9.6 9.8 10.7
2008 10.9 11.2 12.0 14.9
over 1 year in roubles
2006 12.7 12.7 12.5 12.1
2007 12.1 11.5 11.0 11.4
2008 12.3 12.8 13.6 13.8
up to 1 year in US dollars
2006 8.6 8.4 8.6 8.5
2007 8.7 8.8 8.4 9.1
2008 8.1 8.0 8.9 10.9
over 1 year in US dollars
2006 10.5 10.2 10.4 10.0
2007 10.3 10.1 9.3 9.8
2008 9.3 9.9 9.4 11.3
Interest rate on rouble-denominated promissory notes discounted by banks, % p.a.
2006 12.9 8.7 9.2 9.7
2007 9.5 8.9 10.8 10.8
2008 10.7 11.0 12.1 14.1
MICEX rate in ‘tomorrow’ trades, rouble/$
2006 28.0733 27.1897 26.8053 26.5910
2007 26.3056 25.8599 25.5043 24.6525
2008 24.2286 23.6190 24.2718 27.2941
As of end of quarter
RTS index, points
2006 1,434.99 1,494.63 1,549.99 1,921.92
2007 1,935.72 1,897.70 2,071.80 2,290.51
2008 2,053.93 2,303.34 1,211.84 631.89
Refinance rate, % p.a.
2006 12.0 11.5 11.5 11.0
2007 10.5 10.0 10.0 10.0
2008 10.25 10.75 11.0 13.0
Table 8 (continued)
40 2008 Q4
Table 8 (end)
Year 1.01 1.04 1.07 1.10
Monetary indicators
M0, billion roubles
2007 2,785.2 2,741.2 3,027.5 3,220.9
2008 3,702.2 3,475.5 3,724.9 3,904.2
2009 3,794.8
M2, billion roubles
2007 8,995.8 9,412.6 10,857.7 11,494.0
2008 13,272.1 13,382.9 14,244.7 14,374.6
2009 13,493.2
Obligations included in broad money, billion roubles 5
2007 10,149.4 10,898.4 12,033.4 12,699.7
2008 14,636.7 14,918.3 15,926.6 16,067.8
2009 16,774.7
Net foreign assets, billion roubles 5
2007 6,881.5 7,927.4 8,714.1 9,047.0
2008 9,923.5 10,541.0 11,282.7 12,267.3
2009 12,218.0
Domestic claims, billion roubles 5
2007 5,799.2 5,798.6 6,331.1 6,771.7
2008 8,325.9 8,437.2 8,760.6 8,614.9
2009 10,787.8
Broad monetary base, billion roubles
2007 4,122.4 4,210.2 5,139.1 4,587.2
2008 5,513.3 4,871.4 5,422.9 5 317.8
2009 5,578.7
Balances of correspondent accounts, billion roubles
2007 638.1 518.1 528.7 576.3
2008 802.2 596.3 592.4 702.9
2009 1,027.6
M2 velocity
annual average
2007 3.8 3.6 3.4 3.2
2008 3.1 3.0 3.0 3.1
2009 3.0 6
change since start of year, %
2007 -13.2 7 -6.1 -12.2 -16.3
2008 -18.8 7 -2.6 -2.7 -1.6
2009 -2.0 7
Monetisation of the economy (by M2 aggregate), %
2007 26.1 27.8 29.8 31.2
2008 32.2 33.0 33.1 32.7
2009 32.8 6
Money multiplier
by broad monetary base
2007 2.18 2.24 2.11 2.51
2008 2.41 2.75 2.63 2.70
2009 2.42
change since start of year, %
2007 5.2 7 2.5 -3.2 14.8
2008 10.3 7 14.1 9.1 12.3
2009 0.5 7
Foreign exchange rates
roubles per US dollar
2007 26.33 26.01 25.82 24.95
2008 24.55 23.50 23.41 25.37
2009 29.39
roubles per euro
2007 34.70 34.69 34.72 35.35
2008 35.93 37.09 36.97 36.50
2009 41.43
1 Estimate.
2 According to new accounting methodology.
3 (+) signifies appreciation of the rouble, (-) signifies depreciation of the rouble.
4 OFZ effective market portfolio indicator.
5 Presented in new format in compliance with requirements of the Monetary and Financial Statistics Manual (IMF, 2000).
6 Preliminary data
7 Relative to beginning of previous year.
Statistical Addendum
2008 Q4 41
Table 9
Bank of Russia interest rates (% p.a.)
Instrument Liquidity provision/
absorption period
1.10.08 -
14.10.08
15.10.08 -
19.10.08
20.10.08 -
23.10.08
24.10.08 -
11.11.08
12.11.08 -
30.11.08
1.12.08 -
1.02.09
2.02.09 -
9.02.09
10.02.09
Providing liquidity at offered bids (including by auction)
Repo operations 1
1 day 7.0 7.0 7.0 7.0 8.0 9.0 9.0 10.0
1 week 7.5 7.5 7.5 7.5 8.5 9.5 9.5 10.5
3 months — 8.5 8.5 8.5 9.5 10.5 10.5 11.5
6 months 2 — — — — — 11.25 11.25 12.25
12 months 2 — — — — — 11.75 11.75 12.75
Currency swap operations 3 1 day — — 10.0 10.0 12.0 13.0 13.0 13.0
Unsecured loans 1 up to 6 months — — minimum rate is set when auction is announced
Lombard loans 1,4
2 weeks 7.5 7.5 7.5 7.5 8.5 9.5 9.5 10.5
3 months — — 8.5 8.5 9.5 10.5 10.5 11.5
6 months 2 — — — — — 11.25 11.25 12.25
12 months 2 — — — — — 11.75 11.75 12.75
Providing liquidity at fixed rates
Overnight loans 4,5 1 day 11.0 11.0 11.0 11.0 12.0 13.0 13.0 13.0
Lombard loans 4
1 day 8.0 8.0 8.0 8.0 9.0 10.0 11.0 12.0
7 days 6 9.0 8.0 8.0 8.0 9.0 10.0 11.0 12.0
30 days — — 8.0 8.0 9.0 10.25 11.0 12.0
Repo operations 1 day 8.0 8.0 8.0 8.0 9.0 10.0 11.0 12.0
1 week 8.0 8.0 8.0 8.0 9.0 10.0 11.0 12.0
Currency swap operations 1 day 8.0 10.0 — — — — — —
Loans secured by ‘non-market’ assets 5
up to 30 days 9.5 9.0 9.0 9.0 10.0 11.0 11.25 12.0
31 to 90 days — — 9.0 9.0 10.0 11.0 11.25 12.0
91 to 180 days — — — — — 12.0 12.0 12.5
181 to 365 days 7 — — — — — 13.0 13.0 13.0
Loans against the collateral of
promissory notes, credit claims and bank
guarantees 8
up to 90 days 7.5 7.5 7.5 7.5 8.5 8.5 — —
91 to 180 days 8.5 8.5 8.25 8.25 9.25 9.25 — —
Absorbing liquidity at fixed rates
Deposit operations
Tom-next,
spot-next
and call
3.75 4.25 4.25 4.75 5.75 6.75 6.75 7.75
1 week,
spot-week 4.25 4.75 4.75 5.25 6.25 7.25 7.25 8.25
1 Minimum interest rate.
2 From December 12, 2008.
3 Interest rate set on the rouble part when determining the minimum offered swap difference.
4 Pursuant to Bank of Russia Regulation No. 236-P of August 4, 2003.
5 Pursuant to Bank of Russia Regulation No. 312-P of November 12, 2007.
6 If two consecutive Lombard auctions have been declared invalid. Otherwise set at average weighted Lombard auction rate.
7 From January 20, 2009.
8 Pursuant to Bank of Russia Regulation No. 273-P of July 14, 2005 (invalid since January 1, 2009).
42 2008 Q4
Table 10
Bank required reserve ratios (%)
Required reserve ratio for bank obligations
to non-resident banks in Russian and
foreign currency
Required reserve ratio for obligations to
individuals in Russian currency
Required reserve ratio for other bank
obligations in Russian and foreign currency
July 1, 2007 – October 10, 2007 4.5 4.0 4.5
October 11, 2007 – January 14, 2008 3.5 3.0 3.5
January 15, 2008 – February 29, 2008 4.5 4.0 4.5
March 1, 2008 – June 30, 2008 5.5 4.5 5.0
July 1, 2008 – August 31, 2008 7.0 5.0 5.5
September 1, 2008 – September 17, 2008 8.5 5.5 6.0
September 18, 2008 – October 14, 2008 4.5 1.5 2.0
October 15, 2008 – April 30, 2009 0.5 0.5 0.5
May 1, 2009 – May 31, 2009 1.5 1.5 1.5
June 1, 2009 – 2.5 2.5 2.5
© The Central Bank of the Russian Federation, 2009
Research and Information Department