CBR Quarterly Inflation Review - Q1 2012
Central bank: cbr | Type: quarterly_review | Date: 2012-03-31

THE CENTRAL BANK
OF THE RUSSIAN FEDERATION
(BANK OF RUSSIA)
Quarterly
Inflation
Review
2012 Q1
Research and Information Department
The electronic version of Quarterly Inflation Review is available on the Bank of Russia's website:

Contents
Introduction. .................................................................................................................3
Inflation.Dynamics. ........................................................................................................5
Consumer prices ....................................................................................................................... 5
Housing prices .......................................................................................................................... 8
Producer prices ......................................................................................................................... 8
Foreign trade .......................................................................................................................... 10
Demand ................................................................................................................................. 12
Supply .................................................................................................................................... 14
Employment and unemployment ............................................................................................... 15
Monetary.Conditions...................................................................................................17
Exchange rate ......................................................................................................................... 17
Interest rates ........................................................................................................................... 18
Asset prices ............................................................................................................................ 22
Monetary aggregates ............................................................................................................... 23
Credit aggregates .................................................................................................................... 25
Bank.of.Russia.press.releases.on.monetary.policy.measures..........................................28
Statistical.Addendum.................................................................................................. 31
2012 Q1 3
Introduction
Economic growth accelerated in January-
March 2012 as compared with the same period
of 2011. Consumer and investment activity re -
mained high. Rising domestic demand did not
prevent consumer price growth from slowing
down as actual output of goods and services was
estimated as close to its potential level.
Russia’s inflation slowed to 3.7% in March as
compared with the same month last year , which
was below the 2012 goal range of 5-6% stipulat-
ed in the Guidelines for the Single State Monetary
Policy in 2012 and for 2013 and 2014. Growth in
food and non-food prices slowed down as com -
pared with the previous year. The prices of some
paid services provided to households grew con -
siderably slower at the beginning of the year as
the government rescheduled for July the planned
increase in some administered tariffs. The average
monthly rate of consumer price growth in the first
quarter of 2012, matched the average monthly
rate in 2011, as a whole. Consumer prices grew
by 3.6% in April 2012 year on year.
The Bank of Russia conducted its monetary
policy in the first quarter of 2012, against the
backdrop of slower inflation, high uncertainty
over external economic developments and per -
sisting risks to sustainable growth of the Russian
economy. The Bank of Russia’s monetary policy
decisions were based on an assessment of main -
taining a balance between medium-term infla -
tionary risks and growth outlooks of the economy,
considering the need to ensure the sustainable
development of the banking sector , the dynam -
ics of inflationary expectations and the degree of
tightness of current monetary conditions. In Jan -
uary-May 2012, the Bank of Russia kept interest
rates on its liquidity provision and absorption op-
erations unchanged, while making a number of
decisions on extending the term of liquidity provi-
sion operations.
The inflow of funds through the budgetary
channel in late 2011, the purchase of foreign cur-
rency by the Bank of Russia in the domestic for -
eign exchange market in early 2012, and also the
increased volume of the Bank of Russia’s lending
to credit institutions against non-market assets
and guarantees contributed to the reduction of
money market short-term rates in January-Febru-
ary 2012. The withdrawal of funds through the
budgetary channel in March and the increased
need of credit institutions for refinancing led to
the growth of money market rates in March-April.
Stock exchange market participants showed
stronger demand for the securities of Russian is -
suers between January and the first half of March,
which lifted the prices of these equities. From
mid-March, yields on government bonds were
observed to grow and yields on regional and cor-
porate bonds fluctuated within a horizontal band,
while share prices slightly declined. The growth of
interest rates on banks’ operations with individu -
als and non-financial organisations was a prevail-
ing trend in the credit and deposit market.
Credit aggregate dynamics in the first months
of 2012 testified to the banks’ sufficiently high
credit activity as a whole. However , the contin -
ued tightening of money market conditions and
changes in the structure of the banks’ funding
may limit credit activity.
The growth of banks’ lending activity was
a major factor determining monetary dynam -
ics from the second half of 2011, and in the first
months of 2012. The trend towards the inten -
sive slowing of the annual rates of money supply
growth observed from the second half of 2010
came to a halt in the fourth quarter of 2011, and
their dynamics stabilised at a relatively high level,
which suggested the emergence of medium-term
inflationary risks.
Inflationary risks also relate to the expect -
ed rise in inflation in the second half of the year
largely due to the planned increases in adminis -
tered tariffs and the statistical base effect, which
may negatively affect inflationary expectations.
Also, the fall in vegetable and fruit prices may be
less significant than in the previous year.
The Bank of Russia estimates that inflation in
2012 will stay within the target range stipulated
in the Guidelines for the Single State Monetary
Policy in 2012 and for 2013 and 2014. Russia’s
4 2012 Q1
economic situation is expected to be character -
ised by continued economic growth and the rise
in employment until the end of this year. Business
activity will stay moderate and will not create any
significant pressure on price growth from the de-
mand side.
2012 Q1 5
in the first quarter of 2011 they grew by 10.3%.
As a whole, administered service tariffs grew by
an estimated 0.6% in January-March 2012, or
by 7.7 percentage points slower than in the same
period last year.
Growth in non-administered prices of many
types of services was slower than in the previous
year. As a whole, service prices grew by 0.6% in
January-March 2012 as compared with 5.2%
in the same period last year. The rise in service
prices accounted for an estimated 0.2 percentage
points, or 10.6%, of the overall consumer price
growth in January-March 2012 as compared with
1.4 percentage points, or 35.5%, in January-
March 2011.
Food prices grew by 2.3% in January-March
2012, including a 7.8% increase in vegetable and
fruit prices, registering the slowest first-quarter
price growth for the entire period of observations.
Growth in food prices contributed an estimated
0.8 percentage points, or 58.1%, to the inflation
rate in January-March 2012 as compared with
1.9 percentage points, or 48.7%, in January-
March 2011.
The most significant increase in basic food
prices, excluding vegetable and fruit prices, in
January-March 2012 was registered in the prices
of granulated sugar (by 9.4%), eggs (by 6.6%)
and alcoholic beverages (by 3.0%). In January-
March 2011, the prices of these food products
went up by 6.5%, 1.5% and 2.7%, respectively.
There was also a decrease in the prices of groats
Russia’s inflation slowed to 3.7% in March as
compared with the same month last year, which
was below the 2012 target range of 5-6% stipu-
lated in the Guidelines for the Single State Mon -
etary Policy in 2012 and for 2013 and 2014.
Consumer price dynamics were influenced by the
restrained dynamics of producer prices in indus -
tries whose output goes to the consumer goods
market and in agriculture, generally favourable
situation in the global agricultural market and
the strengthening of the ruble. The government’s
decision to reschedule from January to July the
planned increase in administered prices and gas
tariffs and the tariffs of natural monopolies in the
electric power sector had a noticeable effect on
the growth of housing and utility prices and the
inflation rate as a whole.
Consumer prices
According to the Federal State Statistics Ser -
vice, consumer prices grew by 1.5% in January-
March 2012 (by 3.8% in January-March 2011).
The core inflation stood at 1.4% in the first quar-
ter of 2012, or 1.1 percentage points less than in
the first quarter of 2011. Growth in the prices of
goods and services included in the core inflation
calculation in January-March 2012 accounted for
an estimated 1.1 percentage points, or 77.2%, of
the inflation rate as against 2.0 percentage points,
or 52.0%, in January-March 2011.
Housing and utility prices and tariffs stayed
on average at the December 2011 level, whereas
Inflation Dynamics
Consumer price inflation
Growth, %
Change, percentage points
March 2012 on December 2011 March 2011 on December 2010
Prices of goods and services, total 1.5 3.8 Slowing of growth by 2.3
of which:
– food prices 2.3 4.8 Slowing of growth by 2.5
of which:
– food prices, excluding vegetable and fruit prices 1.7 3.5 Slowing of growth by 1.8
– non-food prices 1.2 1.7 Slowing of growth by 0.5
– prices of paid services provided to households 0.6 5.2 Slowing of growth by 4.6
Prices of goods and services included in core inflation calculation 1.4 2.5 Slowing of growth by 1.1
Source: Rosstat.
6 2012 Q1
points, or 15.8%, in January-March 2011. The
biggest growth was registered in the prices of to-
bacco products (5.8% as compared with 6.5% in
January-March 2011) and detergents and clean-
ing products (3.5% as against 6.5% and 1.9% in
the same period last year , respectively).
Consumer prices grew by 1.2 percentage
points faster than the prices of paid services pro -
vided to households in January-March 2012 (this
growth was 1.9 percentage points slower in the
same period a year earlier).
According to Rosstat data, consumer price
growth rate in all federal districts of Russia in
January-March 2012 was slower than in the
same period last year.
and beans (by 5.8%), sunflower oil (by 2.3%)
and pasta (by 0.3%) in the period under review.
In January-March 2011, the prices of these food-
stuffs increased by 16.8%, 6.6% and 3.4%,
respectively. The rates of growth in the prices of
other basic foodstuffs varied between 0.3% and
1.8% in January-March 2012 as compared with
the range between 2.8% and 5.3% in the same
period last year.
Non-food prices grew by 1.2% in the first
quarter of 2012 as compared with 1.7% in Janu-
ary-March 2011. The increase in non-food prices
accounted for an estimated 0.5 percentage points,
or 31.3%, of the overall consumer price growth in
January-March 2012 as against 0.6 percentage
Food price inflation
Growth, %
Change, percentage points
March 2012 on December 2011 March 2011 on December 2010
Foodstuffs 2.3 4.8 Slowing of growth by 2.5
Bread and bakery products 0.6 5.3 Slowing of growth by 4.7
Groats and beans -5.8 16.8
Pasta -0.3 3.4
Meat and poultry 1.8 3.5 Slowing of growth by 1.7
Fish and seafood 1.5 4.1 Slowing of growth by 2.6
Milk and dairy products 0.8 2.8 Slowing of growth by 2.0
Butter 0.3 2.8 Slowing of growth by 2.5
Sunflower oil -2.3 6.6
Granulated sugar 9.4 6.5 Acceleration of growth by 2.9
Vegetables and fruit 7.8 15.8 Slowing of growth by 8.0
Alcoholic beverages 3.0 2.7 Acceleration of growth by 0.3
Source: Rosstat.
Inflation Dynamics
2012 Q1 7
increased to 42.2% in March 2012, from 37.8%
a year earlier.
The rates of growth in food prices, excluding
vegetable and fruit prices, ranged from 1.4% to
2.4% in the federal districts in 2012, while the
rates of non-food price growth changed within
the range of 0.6-1.5%.
Growth in vegetable and fruit prices slowed
down in January-March 2012 in all the federal dis-
tricts as compared with the first quarter of 2011,
although the price evolution was characterised
Estimates show that the differences between
constituent territories of the Russian Federation in
terms of the price of the fixed set of goods and
services used by the Federal State Statistics Ser -
vice for interregional comparisons of the purchas-
ing power of the population widened in March
2012. Specifically, the regional difference ratio 1
1 The regional difference ratio is calculated by the Bank of
Russia as the difference between the price of a fixed set of
goods and services in the most and least expensive regions
relative to the national average cost of the set.
Analysis of price growth distributions for consumer goods and services
An analysis of the price growth distribution for goods and services is made to study inflationary processes
in detail and identify additional risks related to variability of price dynamics of consumer basket components. This
distribution for first-quarter data in 2009-2012 was based on a sample of more than 475 consumer goods and
services, regardless of their weights in consumer spending.
Over the past four years, the dynamics of mean and median of price growth distributions for goods and
services in January-March registered a periodicity related to supply shocks in the food market. Their values were
observed to fall considerably during even years and increase slightly during odd years. In the first quarter of
2012, the distribution median decreased to 0.9% from 2% a year earlier, while the distribution mean narrowed
to 1.4% from 3.3%. The standard deviation contracted from 4.4% to 3%.
The distribution of food price growth in the first quarter of 2012 repeated virtually entirely the distribution
registered in 2010. Both periods registered recovering price dynamics after price spikes in previous years caused
by supply shocks in the agricultural market. The distribution mean in January-March 2012 differed from its value
in the same period of 2010, as the share of foodstuffs with high price growth (over 10%) declined more than
twofold, from 7.3% to 3.2%.
In January-March 2012, the prices of almost three-fourths of non-food goods ranged within a narrow
price growth band of 0-2%, whereas their share in the previous two years did not exceed 60%.
The government’s decision to reschedule planned increases in administered prices on housing and utility
services from the beginning of the year to July significantly influenced the overall pattern of household service
price growth distribution, which became unimodal. The mean and median values stood at about 1% as com -
pared with 4.2% and 3.5%, respectively, in January-March 2011. The standard deviation decreased consider-
ably. For the first time, a negative skewness was observed, suggesting distribution asymmetry towards values
not exceeding the mean value.
8 2012 Q1
dropped by 0.8% in January-March 2012 (they
grew by 3.8% in the same period last year). Spe-
cifically, the fall in producer prices was registered
in some manufacturing industries whose output
largely goes to the consumer goods market.
As the government rescheduled for July the
planned increase in administered electricity, heat
and natural gas tariffs, producer prices in the pro-
duction and distribution of electricity, gas and wa-
ter were observed to decline (by 0.2%) in Janu -
ary-March 2012 instead of their seasonal growth.
The growth of Russian producer prices in
mining matched, as a whole, the dynamics of
world energy prices. These prices registered their
month-by-month acceleration in the first quarter
by a considerable disparity across the constituent
territories of the Russian Federation. Specifically,
in the Far Eastern Federal District vegetable and
fruit prices rose by 2.7%, whereas in the Central
Federal District they grew by 10.3%.
The rates of growth in household service
prices in the federal districts varied between 0.4%
and 1.1 % in January-March 2012.
Housing prices
Housing prices increased by 3.3% in the pri-
mary market and by 3.2% in the secondary mar-
ket in March 2012 from December of the previ -
ous year. Over the same period of 2011, housing
prices grew by 1.5% in the primary market and
by 1.3 % in the secondary market.
In January-March 2012, housing price dy -
namics were influenced by a rebound in the real
estate market amid growth in commissioned
housing. Specifically, the floorspace commis -
sioned in January-March 2012 grew by 5.7%
year on year , whereas in the same period last year
it contracted by 2.4%.
Producer prices
Industrial producer prices rose by 2.9% in
January-March 2012 as against 7.0% in January-
March 2011.
Producer price dynamics in manufacturing
industries were influenced by demand restrictions,
including restrictions attributable to imports price
competition as a result of the ruble’s apprecia -
tion. Producer prices in manufacturing industries
Inflation Dynamics
2012 Q1 9
by 4.3% in the same period last year) due to the
decrease in pipeline transportation tariffs. Railway
freight rates went up by 5.9% in the first quarter
of 2012 as against 7.5% a year earlier.
Communications fees for corporate en -
tities grew by 1.0 % in January-March 2012 as
against 3.4 % in the same period of 2011.
of 2012 after their relatively slow growth in the
second half of 2011. In January-March 2012,
the rates of growth in mining producer prices ex-
ceeded (114.7%) the respective figure for 2011
(113.1%).
Freight transportation charges fell by
0.9% in January-March 2012 (they increased
Inflation in countries trading with Russia1
Consumer price growth in the countries that account for a considerable weight in the structure of Russian
imports equalled 1.3% in the first quarter of 2012 (March on December of the previous year) as compared with
1.8% in January-March 2011. The inflationary processes in the countries trading with Russia slowed down in the
conditions of lower business activity in the economies of Europe, Asia and the CIS countries. This slowdown was
also facilitated by relatively stable food prices. The
rise in energy prices was a major inflationary factor in
the first quarter of 2012, but this growth was slower
than in January-March 2011.
The growth of energy prices made the biggest
contribution to overall consumer price growth in the
United States and the eurozone in the first quarter
of 2012. In the United States, the inflation rate was
also significantly affected by changes in the prices of
goods and services included in the calculation of the
core consumer price index, excluding components
depending on volatile world energy and food prices.
In the eurozone, the contribution by this factor was
insignificant as evidenced by slower consumer price
growth in January-March 2012 (1.0% as against
1.6% in the United States). The difference between
the rates of price increases reflected steadier eco -
nomic growth in the United States as compared with
the eurozone that experienced a decline in business
activity.
1 According to data reported by national statistics agencies of Russia’s trading partners.
10 2012 Q1
an embargo on Iranian crude oil supplies to the
world market and the growth of demand for oil
from China and other Asian countries. Large US
commercial oil reserves, eurozone debt problems
and downward adjustments of 2012 oil demand
growth forecasts were the factors that restrained
oil price increases. The price of the Russian crude
oil was 14.6% higher in world markets in the first
quarter of 2012 than in the same period last year
and stood at $117.5 per barrel. Natural gas prices
in the European market increased by 22%.
Petroleum product prices broadly followed
changes in oil prices. In January-March 2012,
petroleum product prices rose by 18% on aver -
age. The prices of fuel oil demonstrated the high-
Building materials producer prices in-
creased by 0.8% in the first quarter of 2012 as
compared with 1.7 % in the same period last year.
The large supply of agricultural products en-
sured by last year’s harvest and moderate world
agrarian price increases restrained the dynamics
of agricultural producer prices at the begin -
ning of this year: these prices grew by 2.5% in
January-March 2012 as compared with 6.2% in
the same period last year. Crop grower prices rose
by 2.0% (by 11.6% in the first quarter of 2011),
while livestock producer prices went up by 2.8%
(by 1.9% in the same period last year). Grain
producer prices grew by 1.7% in January-March
2012 as against 11.2% in the same period of
2011. Sunflower producer prices went down by
2.3% (they increased by 7.2% in January-March
2011).
Foreign trade
T erms for Russia’s trade continued to im -
prove in the first quarter of 2012, although at
a slower pace than in the same period last year.
World energy prices were considerably higher in
January-March 2012 than in the same period last
year, while non-energy prices were lower. Domes-
tic producer prices increased in the mining sector
and fell in manufacturing industries. World prices
of foodstuffs and raw agricultural commodities
were on average lower in January-March 2012,
than in January-March 2011 despite an increase
in the prices of some products. The domestic con-
sumer market was characterised by low rates of
growth in foodstuff prices.
The price situation for major Russian exports
commodities in global markets2 remained favour-
able as a whole in January-March 2012. World
energy prices grew by 16% on average in the first
quarter of 2012 as compared with the same pe -
riod last year , while non-energy prices fell by 8%.
Oil price dynamics in the first quarter of 2012
were largely influenced by the aggravation of the
political situation around Iran, the imposition of
2 Average prices are based on data reported daily by the fol-
lowing news agencies and exchanges: Reuters for oil, Fi -
nancial Times for petroleum products (petrol, diesel fuel
and fuel oil) and sugar. Ferrous metal prices have been
gauged on the basis of price indices, while prices of natu -
ral gas, non-ferrous metals (aluminium, copper and nickel)
and other commodities are monthly averages published by
the World Bank and the IMF .
Inflation Dynamics
2012 Q1 11
of 2012. Year on year , the prices of wheat went
down by 16% and maize – by 2%, while the pric-
es of barley and rice increased by 9% and 6%,
respectively. The world prices of virtually all food-
stuffs, except meat, continued to fall in monitored
foodstuff markets in the period under review. The
world prices of raw sugar declined by 21%, re -
fined sugar – by 16% and palm oil – by 11% in
January-March 2012 as compared with the same
period last year , while beef prices grew by 4% and
pork and poultry prices – by 7%. The prices of
foodstuffs and raw agricultural commodities were
on average lower in the first quarter of 2012, than
in the first quarter of 2011.
est growth rate as they increased by 25% in the
first quarter of 2012 as compared with the same
period last year , while petrol and diesel fuel prices
went up by 14% and 12%, respectively.
The growth of ferrous metal prices slowed
to 2% in January-March 2012 as compared with
the same period last year. World non-ferrous
metal prices continued to decline, falling by 20%
on average as compared with the first quarter of
2011. The biggest decrease was registered in the
prices of nickel, which went down by 27%, while
the prices of copper and aluminium declined by
14% and 13%, respectively.
World grain prices (except barley and rice
prices) continued their slide in the first quarter
12 2012 Q1
The Consumer Confidence Index (CCI) re -
flecting consumer expectations improved in the
first quarter of 2012 as compared with the pre -
vious quarter. The improvement was the result of
growth in the indices of expected and occurred
changes in the respondents’ individual wellbeing
and the index of expected changes in the Russian
economy. The indices of occurred changes in the
Russian economy and conditions for large pur -
chases were virtually unchanged.
In January-March 2012, household real dis-
posable money income was 2.6% higher than
in the same period last year. As the inflation rate
fell considerably, household consumption prefer-
ences continued to grow. The share of consumer
spending in the structure of household money in-
come use increased by 1.9 percentage points in
January-March 2012 on the corresponding peri -
od of 2011 to 80.5 %. Household propensity for
organised savings continued to decrease.
The terms of Russia’s trade continued to
improve in January-March 2012, although at a
slower pace.
Demand
According to estimates, actual output of
goods and services was close to its potential level.
Growing domestic demand did not create pro-
inflationary risks.
Domestic demand
In 2011, economic growth was maintained
largely by higher domestic demand. Household
final consumption expenditures grew by 6.8%
over the year (by 5.2% in 2010). Real wage in -
creases, employment growth and higher con -
sumer lending contributed to stronger consumer
demand in the first quarter of 2012. Real house -
hold spending on goods and services increased by
an estimated 5.8% in January-March 2012.
GDP consumption
(growth as % of corresponding period of previous year)
2010 2011
Q1 Q2 Q3 Q4 Full year Q1 Q2 Q3 Q4 Full year
GDP 3.8 4.9 3.8 4.9 4.3 4.0 3.4 5.0 4.8 4.3
Final consumption 1.1 3.7 4.5 3.8 3.3 4.8 4.7 5.6 6.0 5.3
of which:
– households 1.7 5.7 6.9 6.3 5.2 6.1 6.1 7.2 7.7 6.8
Gross capital formation 3.2 33.5 30.6 35.4 28.8 43.0 22.7 20.0 13.0 20.8
Exports 18.9 4.4 2.2 4.3 7.0 -0.4 2.0 -1.5 1.4 0.4
Imports 11.9 22.3 35.1 29.8 25.8 28.7 23.7 17.9 14.9 20.3
Source: Rosstat.
International trade
The International Energy Agency (IEA) estimates that the world oil consumption growth rates decreased to
0.4% in January-March 2012 from 2.6% in the same period last year. Oil consumption contracted in the devel-
oped countries in North America and Europe, while its growth slowed in China and other emerging economies
in the Asian region.
According to the IEA data, the volume of oil production and the prevailing oil consumption dynamics al -
lowed to restore oil inventories replenishment in the first quarter of 2012. Nevertheless, geopolitical factors
prompted a considerable rise in world oil prices.
The average price of Brent, Dubai and West T exas Intermediate crude grew by 12.8% in the first quarter of
2012 year on year to $112.5 per barrel.
According to Eurostat data, EU import volume of mineral fuel and lubricants increased by 5.7% in January-
March 2012 as compared with the same period last year, while the average unit value of the imports of these
commodities1 grew by 19.4%. According to IMF data, the price of Russian natural gas exported to Germany was
on average 35.0% higher in January-March 2012 than in the same period last year. In March 2012, the price of
natural gas supplied from Russia to Germany was 3.3% higher than in December 2011.
1 The average unit value of imports is the ratio of changes between the value of imports of particular commodities and the
import volume.
Inflation Dynamics
2012 Q1 13
March 2012, from 7.0% of GDP in the same pe-
riod last year.
In 2011, gross capital formation expanded
by 24.6%, which was facilitated by a consider -
able increase in current inventories, and also by a
substantial acceleration of growth in fixed capital
investment in the second half of the year. Fixed
capital investment was financed predominantly
with borrowings, which accounted for 57.3% in
2011, or 1.7 percentage points less than in 2010.
Stronger domestic demand facilitated fur -
ther growth in the imports of goods. The growth
in imports in terms of value was the result of the
expansion of import quantities and the rise of im-
port prices but this growth slowed down in the
first quarter of 2012 due to a slower increase in
import quantities. Year on year , the imports of
goods grew by 13% in January-March 2012 to
$73.3 billion, according to a balance of payments
estimate as of April 3, 2012.
Government expenditures on final consump-
tion increased by 1.5% in 2011 (they fell by 1.4%
in 2010). In January-March 2012, this indicator
was estimated to grow faster than in the same pe-
riod last year as the government increased con -
siderably (almost three-fold) allowances paid to
servicemen and other social transfers from the
beginning of the year.
According to the Federal Treasury’s data,
general budget expenditures grew to 35.6% of
GDP in January-March 2012 (30.6% in the same
period of 2011). Non-interest expenditures ac -
counted for 34.6% of GDP (29.8% in January-
March 2011). The budget expenditure dynamics
resulting from more evenly spread expenditure
allocations throughout the year caused the bud -
get surplus to lower to 4.0% of GDP in January-
Economic growth in foreign countries1
According to estimates, GDP in a group of countries accounting for a considerable weight in the structure
of Russian exports increased by 1.7% in January-March 2012 as compared with the same period last year (it
grew by 4.6% in January-March 2011). Preliminary data suggest that GDP grew by 2.1% in the United States
in January-March 2012 (by 2.2% in the first quarter of 2011). The eurozone GDP was unchanged in January-
March 2012 from the first quarter of the previous year (it expanded by 2.4% in January-March 2011). At the
same time, GDP in the eurozone in the first three months of 2012 was equal to that of the last three months of
2011, whereas in October-December 2011 it contracted by 0.3%. China’s GDP growth slowed to 8.1% from
9.7% in January-March 2011.
Low business activity in the eurozone slowed GDP growth in developing countries in Europe and Asia. At
the same time, the financial market situation gradually stabilised. This stabilisation was facilitated by the Euro -
system’s operations to provide long-term liquidity to credit institutions and the easing of monetary policies in
the eurozone and some other economies. The expansion of official aid to Greece in March 2012 played a key
stabilising role. These factors contributed to the recovery of economic agents’ more optimistic sentiments in the
leading eurozone countries.
In April 2012, the IMF made an upward revision of its current-year forecast of GDP contraction in the eu-
rozone to 0.3% from 0.5% in its previous forecast released in January. This factor, along with an upgrade of the
US GDP growth estimate to 2.1% from 1.8% and other forecast adjustments caused some improvement in the
global economic outlook. The world output of goods and services is estimated to grow by 3.5%, while interna-
tional trade in goods and services is expected to expand by 4.0% in 2012 (the IMF data published in January
suggested a growth of 3.3% and 3.8%, respectively).
1 According to data compiled by the national statistics agencies of Russia’s trading partners.
14 2012 Q1
Supply
Over 2011, the production of goods and
services reached the 2008 level, with capacity
utilisation in industry continuing to increase to
approach its pre-crisis level. Economic growth ac-
celerated in the first quarter of 2012 as compared
with the same period last year.
In January-March 2012, the output in key
economic activities increased by 5%. Production
growth was registered in all the key types of eco-
nomic activity.
Industrial output grew by 4.0% in the first
quarter of 2012. As adjusted for seasonal and
calendar factors, month-on-month industrial pro-
duction growth accelerated in January and Febru-
ary and slowed in March.
High growth rates were registered in manu -
facturing industries, with the production of trans-
port vehicles, machinery and equipment, other
non-metallic mineral products rising most sub -
stantially.
Industrial production capacity utilisation ratio
increased in early 2012, and actually reached the
pre-crisis level. The Russian Economic Barometer
reported that capacity utilisation ratio averaged
76.5% in January-February 2012 as compared
with 73.5% in January-February 2011.
Agricultural output increased by 4% in Janu-
ary-March 2012. As of early April 2012, the live-
stock population grew by 1.1%, while slaughter
cattle and poultry production expanded by 8.2%
in the first quarter of 2012. Therefore, the do -
Over one-third of total fixed capital investment
was used to purchase machinery, equipment and
vehicles.
Investment activity continued to grow at a
fast pace in early 2012. Fixed capital investment
expanded by 11.2% in the first quarter of 2012.
In 2011, with import quantities of goods
and services growing faster than export quanti -
ties, net exports of goods and services were esti -
mated to register a negative growth.
Foreign demand
Foreign demand for Russian goods slightly
expanded in the first quarter of 2012.
The export quantities of some goods were
observed to recover after their considerable con -
traction in 2011. The export quantities of oil,
petroleum products, ferrous and especially non-
ferrous metals, and also some other commodities
expanded in January-March 2012 as compared
with the same period last year. The exports of
goods grew by 19% in the first quarter of 2012
to $134.7 billion, according to a balance of pay -
ments estimate as of April 3, 2012. This growth
was attributable both to the increase in export
prices and the expansion of export quantities.
The price increase made a bigger contribution to
the export growth than the expansion of export
quantities.
Exports to European Union (EU) member
countries grew faster than overall exports. The EU
share in Russia’s goods exports grew by 2.1 per -
centage points in January-March 2012 from the
same period of 2011. Within this group of coun -
tries, the proportions of major importers of Rus -
sian goods, such as the Netherlands, Germany
and Italy, increased, while Poland’s share declined.
Growth in exports to the Asia-Pacific Economic
Cooperation (APEC) countries slowed down. The
share of APEC member countries in Russia’s goods
exports fell by 0.3 percentage points. Within this
group of countries, the United States increased its
share; the shares of China and South Korea were
unchanged, while the share of Japan continued to
contract. Exports to CIS member countries virtu -
ally stayed at the level registered in the first quar-
ter of 2011. The growth of exports to Belarus and
other CIS countries was offset by a contraction in
exports to Ukraine.
Inflation Dynamics
2012 Q1 15
The number of people employed in the econ-
omy increased by 0.7% in January-March 2012.
The number of employees standing idle through
employers’ fault and for reasons beyond the con-
trol of employers and employees continued to
contract, which testified to the growing workforce
utilisation in the economy.
Labour productivity increased by an estimat-
ed 4.2% in January-March 2012. According to
estimates, labour productivity grew faster in the
goods producing sector than in the services sec -
tor.
Real wages grew by 11.7 % in January-
March 2012. Unit labour costs measured as a
share of compensation of employees (including
mestic food market situation remained favourable
and exerted no negative pressure on consumer
price dynamics.
In January-March 2012, GDP grew by 4.9%
(it expanded by 4% in the first quarter of 2011).
Actual output was estimated close to its potential
level, which did not prevent inflation from going
down.
Employment and unemployment
In 2011, the number of people employed
in the economy virtually reached the 2008 level.
The unemployment rate continued to decline in
January-March 2012, and was estimated below
the long-term trend.
16 2012 Q1
hidden compensation and mixed income), contin-
ued to decline in the breakdown of GDP by source
of income. They fell by 0.1 percentage points to
49.8% in 2011 as compared with 2010.
The total number of unemployed declined by
13.3% in January-March 2012 to 6.5% of the
economically active population as of the end of
March (7.1% as of the end of March 2011). To -
tal unemployment exceeded the number of reg -
istered unemployed by a factor of 3.7 in the first
three months of 2012, with most of the jobless
looking for work without any support of employ-
ment services.
Total unemployment was estimated below
the long-term trend in January-March 2012.
Average monthly imputed wage by type of economic activity
(January-February 2011)
Type of activity Rubles As % of the all-Russian level
Total 23,891 100
Agriculture, etc. 12,027 50
Mining 45,249 1.9 times
Manufacturing industries 22,293 93
Electricity, gas and water production and distribution 26,775 112
Construction 23,202 97
Wholesale and retail trade, etc. 21,019 88
Transport and communications 28,916 121
Financial activity 56,969 2.4 times
Real estate and other transactions 27,349 115
Public administration, etc. 28,974 121
Education 16,726 70
Public health care and social services 18,164 76
Public utility services, etc. 18,999 80
Source: Rosstat.
2012 Q1 17
supply steadily exceeded demand in the domestic
foreign exchange market over this period, which
created conditions for the ruble’s appreciation.
Russia’s international reserves grew by 3.0%
from the beginning of 2012 to $513.5 billion as
of April 1, 2012.
The nominal ruble/US dollar rate grew by
3.2% in the first quarter of 2012 quarter on quar-
ter (the nominal ruble/US dollar rate fell by 7.0%
in the fourth quarter of 2011 quarter on quarter).
The official rate of the US dollar against the ruble
Exchange rate
In the first quarter of 2012, the domestic for-
eign exchange market was influenced by trends in
the external and internal financial and commodity
markets, and also by the parameters of the Bank
of Russia’s exchange rate policy, which was aimed
at maintaining the ruble’s stability as part of the
managed floating exchange rate regime. Favour-
able trends in world markets for raw materials
contributed to the persisting foreign currency in -
flow into the country. As a result, foreign currency
Monetary Conditions
18 2012 Q1
tive contribution of the inflation differential slight-
ly increased as compared with the fourth quarter
of 2011.
The real ruble/euro rate grew by 6.9% in
January-March 2012 (it fell by 2.2% in the fourth
quarter of 2011). As in the second half of 2011,
this indicator was largely shaped by the nominal
ruble/euro rate.
The real effective rate of the ruble against
foreign currencies appreciated by 4.8% in the
first quarter of 2012 (it fell by 2.2% in the fourth
quarter of 2011 quarter on quarter).
The analysis of ruble rate movements against
major global currencies in the first quarter of
2012 suggests low risks of inflation acceleration
as a result of exchange rate fluctuations in the
short term.
Interest rates
In January-April 2012, the Bank of Russia
took decisions to keep the refinancing rate and in-
terest rates on its operations unchanged on the ba-
sis of assessment of inflation risks and sustainable
economic growth risks. As a result, one-day fixed
rates on liquidity provision instruments amounted
was 29.3282 as of April 1, 2012, and reached
29.3627 as of May 1, 2012.
The nominal ruble/euro rate increased by
6.1% in the first quarter of 2012 as compared
with the fourth quarter of 2011 (it fell by 2.4%
in October-December 2011 quarter on quar -
ter). The official rate of the euro against the ruble
equalled 39.1707 as of April 1, 2012, and stood
at 38.9203 as of May 1, 2012.
The ruble value of the bi-currency basket
tended to decline in January-March 2012, as a
result of the ruble’s appreciation against the dollar
and the euro for most of the first quarter of 2012.
The value of the bi-currency basket was 33.7573
rubles as of April 1, 2012, and stood at 33.6636
rubles as of May 1, 2012.
The nominal effective rate of the ruble against
foreign currencies increased by 4.6% in January-
March 2012 quarter on quarter (in October-De -
cember 2011, this rate fell by 0.9% as compared
with the previous quarter).
The real ruble/US dollar rate grew by 3.8%
in the first quarter of 2012. This indicator was
largely shaped by the ruble/dollar nominal rate
index in January-March 2012. However , the rela-
International currency market
The dollar/euro rate did not change significantly in March 2012 as compared with December 2011. The
currencies of Russia’s major trading partners allowing exchange rate flexibility, except the Japanese yen, ap -
preciated against the dollar and the euro. The British pound, the Swedish krona, the Swiss franc and the South
Korean won appreciated by 1-2%; the Brazilian real, the Indian rupee, the Turkish lira, the Czech koruna, the
Hungarian forint and the Belarussian ruble strengthened by 3-5%, while the Polish zloty gained more than 8%.
The Chinese yuan grew by less than 1% against the major currencies, while the Japanese yen depreciated by
more than 5%.
Monetary Conditions
2012 Q1 19
considerably in April 2012. As a result, the spread
between the rates on loans with the longest and
the shortest maturity periods widened consider -
ably. These changes in the structure of rates on
interbank ruble loans may suggest that the April
level of rates on the shortest-term interbank loans
is likely to stay or grow moderately.
The average spread between the average
market MIACR and the rate on loans to banks
with investment-grade credit ratings (MIACR-IG)
also widened in March-April 2012. This spread
increased to 15 basis points in March-April from
6 basis points in January-February. The widened
spread may reflect different terms of access to the
sources of funding for various groups of banks
to 8% p.a. on overnight loans and 6.25% p.a. on
repo operations and Lombard loans over this pe -
riod. The lower limit of the Bank of Russia interest
rate band was defined by the standard overnight
deposit rate, which stood at 4% p.a. At the same
time, the lowest possible interest rate, at which
credit institutions were able to raise funds from
the Bank of Russia in refinancing operations (repo
auctions and Lombard loan auctions), amounted
to 5.25% p.a. Given the current internal and ex -
ternal macroeconomic trends, the Bank of Russia
regarded the level of money market interest rates
evolving within the interest rate band as accept -
able to achieve its monetary policy goals.
The improved banking sector liquidity in
January-February 2012 contributed to lower in-
terbank loan rates. The MIACR on overnight in-
terbank ruble loans did not exceed 4.5% p.a. for
most of this period, which was below its level at
the end of 2011.
Interest rates on loans for a term of 2-7 and
8-30 days also went down. The segment of inter-
bank loans with a term of over 1 month demon -
strated mixed interest rate dynamics, suggesting
the absence of definite expectations about future
interest rate dynamics.
The increased demand for ruble liquidity
contributed to the growth in interbank loan rates
in March-April 2012. The interest rates on over -
night interbank ruble loans returned to the level
of the last months of 2011. The rates on inter -
bank loans for a term of over 1 month also grew
20 2012 Q1
percentage points to 6.6% p.a. and 7.8% p.a.,
respectively, in January-March 2012 quarter on
quarter.
In the ruble-denominated household loan
market, the average interest rate on short-term
loans declined by 0.2 percentage points in the
first quarter of 2012 quarter on quarter , to 24.5%
p.a., and on long-term loans it grew by 0.7 per -
centage points to 17.8% p.a.
and some weakening of mutual trust between
banks – market participants.
Interest rates on household ruble deposits
for different terms demonstrated mixed dynamics
in the first quarter of 2012: they tended to decline
on short-term household deposits and continued
to rise on long-term deposits (for a term of 1-3
years). Average rates on short-term and long-
term household deposits grew by 0.2 and 0.7
Liquidity situation and Bank of Russia operations
Russian credit institutions regularly applied to the Bank of Russia for refinancing in January-April 2012. The
Bank of Russia’s average daily claims to credit institutions on liquidity provision operations amounted to 862.5
billion rubles in the first quarter of 2012, and to 1,078.6 billion rubles in April 2012. At the same time, federal
budget funds deposited with commercial banks through auctions as a source of liquidity were considered as less
important in the reporting period. The average daily amount of these funds equalled 235.3 billion rubles in the
first quarter of 2012, and 45.5 billion rubles in April 2012. Meanwhile, credit institutions’ funds deposited with
the Bank of Russia averaged 250 billion rubles in the first quarter of 2012, and 116 billion rubles in April 2012.
Liquidity levels fluctuated in the reporting period, which was primarily evidenced by the dynamics of the
MIACR on overnight ruble loans in the money market. In February, the MIACR was on average 0.4 percentage
points higher than the overnight deposit rate, whereas in January and March, it fluctuated near the minimum bid
rate established at overnight repo auctions. The increased tension in the interbank market in April 2012 caused
the MIACR to exceed the level of 5.25% p.a.
Considering the evolving liquidity situation, the Bank of Russia took a decision in late March to restart repo
and Lombard loan auctions with a term of 12 months, and also the provision of loans secured by non-market as-
sets or guarantees with maturities of 181 to 365 days. Also, the Bank of Russia started to provide gold-secured
loans for a term of 181 to 365 days.
In April 2012, the Bank of Russia Board of Directors took certain decisions to restrain interest rate volatility
in the money market and raise the efficiency of its interest rate policy, as it made changes to the system of mon-
etary policy instruments. From April 10, 2012, the Bank of Russia introduced deposit auctions for a term of 1
week and suspended from April 17, 2012 fixed-rate deposit operations and Lombard loans for a term of 1 week.
Starting from April 17, 2012, the Bank of Russia holds on Tuesdays either auctions to provide bank reserves
(repo and Lombard loan auctions) or auctions to absorb temporarily uncommitted funds (deposit auctions) for
a term of 1 week. The Bank of Russia takes decisions on the direction and the maximum amount of these opera-
tions pursuant to liquidity forecasts.
Monetary Conditions
2012 Q1 21
Investors’ demand for ruble-denominated
bonds increased in the first months of 2012 as
compared with the last months of 2011. Bond
yields tended to decline in the period between
January and the first half of March. From mid-
March, the yields of ruble-denominated federal
government bonds (OFZs) started to increase,
while the yields of regional and corporate bonds
fluctuated within a horizontal band. By the end of
April 2012, the yields of OFZ, regional and cor -
porate bonds declined by 0.2, 0.5 and 0.3 per -
centage points to 7.7% p.a., 7.8% p.a. and 8.5%
p.a., respectively, as compared with the end of
December 2011.
Interest rates on ruble loans to non-finan-
cial organisations decreased in January; the
rates on short-term loans tended to grow in Feb -
ruary-March, while the rates on long-term loans
increased in February and stayed unchanged in
March. Average interest rates on short-term and
long-term loans increased by 0.1 and 1.1 per -
centage points to 9.0% p.a. and 11.2% p.a.,
respectively, in January-March 2012 quarter on
quarter. The yield curve for loans to non-financial
organisations shifted downward in the first quar-
ter of 2012 quarter on quarter in the up-to-1-
month segment, and moved up in the segment of
longer maturities.
22 2012 Q1
The OFZ zero coupon yield curve had an as -
cending slope along its entire length in January-
April 2012. The yield curve had moved down by
late March from early January and its slope de -
creased, and by late April it had moved upward
almost to the level registered in late February.
Asset prices
In January-March 2012, the Russian equity
prices continued to recover after their significant
fall in April-October 2011. From January to mid-
March, positive price trends in the world stock
and oil markets and the investors’ risk appetite
growth contributed to the quick rise in the MICEX
and RTS stock indices. In the second half of March,
these indices registered a downward correction as
domestic stock market participants resorted to
profit-taking amid the persisting external threats
(high global financial and economic risks, strong
volatility in world raw material and financial mar-
kets). As of March 30, 2012, the MICEX index
grew by 8.2% as compared with the end of the
fourth quarter of 2011 to 1,517.34 points, while
the RTS index went up by 18.5% to 1,637.73
points. The average MICEX and RTS stock indices
increased by 7.7% and 11.7%, respectively, in
the first quarter of 2012 and exceeded the cor -
responding indicators for the fourth quarter of
2011.
In January-March 2012, share prices in the
key sectors of the Russian economy increased sig-
nificantly. The biggest growth was registered in
the stocks that depreciated the most in 2011, i.e.,
the shares of companies in the consumer , ma -
chine-building and electric power sectors mainly
oriented to domestic demand, and also the shares
of credit institutions.
In April 2012, Russian share prices tended
to decline as a result of uncertainty over further
share price dynamics in the market. As of the
end of April 2012, the MICEX index fell by 2.9%
month on month to 1,473.50 points, and the RTS
index decreased by 2.7% to 1,593.97 points.
Share prices in most sectors of the Russian econ -
omy declined in April 2012, except for the shares
of chemical, machine-building and consumer
Monetary Conditions
2012 Q1 23
Starting from September 2011, the annual
rates of growth in the M2X broad money dem -
onstrated no clearly expressed trends: the M2X
monetary aggregate grew at an annual rate of
about 20% on average. In January-March 2012,
the annual growth in M2X slightly slowed down
(from 21.1% to 20.2%). Similar to the M2 dy -
namics, the annualised 6-month growth rates of
M2X tended to increase from September 2011,
and started to slow down from January 2012.
The annual growth rates of foreign currency
deposits (in ruble terms) started to increase from
August 2011, and totalled 13.0% over the year
but were considerably lower than the annual rates
of growth in ruble deposits. In January-March
2012, the annual rates of growth in foreign cur -
rency deposits demonstrated no strong fluctua -
tions in their dynamics. The annual growth rate of
foreign currency deposits of non-financial organi-
sations and other financial institutions was 14.5%
as of April 1, 2012, while the same indicator for
households stood at 14.2%.
The level of dollarisation of deposits de -
creased in the previous year from 20.2% to
18.7%. This indicator’s slight increase in January-
February 2012 was seasonal and was conditioned
by the dynamics of dollarisation of deposits held
by non-financial organisations and other financial
institutions. The level of dollarisation of house -
hold deposits continued to decline. As a result, the
overall deposit dollarisation level stood at 19.2%
sector companies, which slightly increased over
this month.
Monetary aggregates
The dynamics of monetary aggregates sug -
gest that the current slowing of inflation is not
linked with monetary factors and inflation risks
persist in the medium term.
The intensive slowdown in the annual rates
of growth in the M2 monetary aggregate that
was observed from the second half of 2010 came
to a halt in the fourth quarter of 2011, and their
dynamics stabilised. In January-March 2012,
the annual growth in ruble money supply slightly
slowed down from 22.6% to 21.3%. The dynam-
ics of the 6-month rates of growth in M2 money
supply, which are less affected by the base effect,
demonstrated higher M2 growth rates from Sep-
tember 2011 to March 2012. This growth slowed
down in March 2012.
The annual rates of growth in household ru -
ble deposits fell by 1.7 percentage points in Jan -
uary-March 2012, to 20.7% as of April 1, 2012.
However , this slowdown was less intensive than
in the first quarter of 2011, when the growth
rates decreased by almost 7 percentage points.
The annual growth rates of ruble deposits of non-
financial organisations and other financial institu-
tions started to increase from November 2011,
and their level was noticeably higher on average
in January-March 2012 (27.2%) than in the first
quarter of 2011 (19.5%).
24 2012 Q1
Assessing the “underlying” growth of money supply
The money supply growth indicator is the fundamental metric used to identify medium- and long-term
inflation risks. Considering the long-term nature of the relationship between money supply dynamics and infla-
tion, short-term monetary aggregate fluctuations do not always adequately reflect risks to price stability. In this
context, the assessment of money supply underlying growth rate is an important element of monetary analysis
that is used as an indicator reflecting the most stable component of money supply dynamics and correspond -
ingly containing the most essential data for inflation risk evaluation.1There are several approaches to calculating
this indicator:
1. Extracting the low frequency component of the M2X monetary aggregate dynamics, using the Christia-
no-Fitzgerald filter.
2. Using the implicit structural filter, 2 making
it possible to smooth out M2X fluctuations, taking
into account lags identified in relationship with infla-
tion dynamics.
3. Calculating the common component in the
dynamics of 14 various monetary indicators on the
basis of the dynamic factor model.3
4. Using the M2X monetary aggregate dy -
namics of the household sector 4 as the most repre -
sentative macroeconomic indicator.
5. Using the structural BVAR-model to identify
money supply shocks among other structural shocks
in the M2X dynamics.
Most of the money supply “underlying” growth
indicators, estimated with the help of alternative
methods, confirmed as a whole the presence of a
turning point in the dynamics of monetary condi -
tions in the economy in 2011, and the transition
from their easing to some tightening and stabilisa -
tion.
1 For details, see Papademos, L. D. and J. Stark (eds.). 2010. Enhancing monetary analysis, Chapter 2. ECB, Frankfurt am
Main.
2 For details, see Bruggeman A., G. Camba-Mendez, B. Fischer and J. Sousa. 2005. Structural filters for monetary analysis –
the inflationary movements of money in the euro area. ECB Working Paper No. 470.
3 For details, see Nobili A. 2009. Composite indicators for monetary analysis. Bank of Italy Working Paper No. 713.
4 For details, see “Sectoral structure of money supply,” Bank of Russia, Quarterly Inflation Review, Q1, 2011, pp. 22-24.
Money supply “underlying” growth
(annual growth rate,%)
Range of money supply “underlying” growth estimates
Median value of money supply “underlying” growth estimates
Source: Bank of Russia calculations.
Monetary Conditions
2012 Q1 25
as of April 1, 2012, and was lower than as of the
same date a year earlier (20.4%).
Growth in lending was the main source of
the expansion of broad money in 2011. Credit
institutions’ claims to non-financial organisations
and households grew more than twofold in 2011
as compared with 2010. The Bank of Russia’s
net claims to general government contracted sig-
nificantly, which had a major restraining effect on
money supply dynamics in 2011. The increase in
the Bank of Russia’s net foreign assets also affect-
ed the overall money supply growth in 2011. The
fall in the net foreign assets of the banking system
and net claims to the general government in Jan -
uary-March 2012 contributed to some slowing of
money supply growth.
Credit aggregates
The current dynamics of credit aggregates
generally suggest the persisting vigorous growth
of banks’ lending activities. The annual growth
in loans to non-financial organisations slightly
slowed down and equalled 24.2% as of May 1,
2012 as compared with 26% as of January 1,
2012, whereas the annual rate of growth in loans
extended to households continued to increase
and reached 42%. As a result, the annual rate of
growth in the total loans stood at 28.2% as of
May 1, 2012. At the same time, the loans to non-
financial organisations and households grew by
only 1.5% in the first quarter of 2012, register -
ing the smallest quarterly increase after the slow-
ing of growth in credit aggregates between the
second quarter of 2009 and the first quarter of
2010. This trend may suggest a beginning of the
credit cycle transition to a more moderate phase.
The tightening of lending terms in loan mar-
kets was an expected event in general and was
conditioned by a number of objective factors. The
outpacing growth of the deposit base was a ma -
jor source of the expanding supply of loans in the
post-crisis period. However , the slower increase
in funds raised in 2011 as compared with 2010,
caused the annual growth in loans to non-finan -
cial organisations and households to exceed the
growth of bank deposits (for the first time since
2009). In this situation, banks need sources of
additional financing to maintain the high rates of
26 2012 Q1
The slower growth in the deposit base
changed the structure of banks’ balance sheets.
The faster growth in low-liquid assets (such as
loans to the real sector of the economy) and the
slower growth in stable funding sources (in par -
ticular , bank deposits) increase liquidity risk and
may force banks to resort to more cautious poli -
cies, limiting the supply of loans.
growth in credit aggregates. Before 2008, these
funds could be raised in foreign markets, whereas
today the most probable source seems likely to
come from a further increase in the role of the
domestic money market and, in particular , from
the continued growth in banks’ demand for Bank
of Russia liquidity provision operations. As can be
expected, this transformation is linked with the
tightening of terms both in the money and loan
markets.
Credit cycle indicators
Lending activity indicators are closely linked with the condition of the real and financial sectors of the econ-
omy and, therefore, are a key element in implementing monetary policies. Sharp fluctuations in the dynamics
of credit aggregates pose a threat to financial and macroeconomic stability. In this context, the analysis of the
sustainability of current credit aggregate dynamics and their conformity with fundamental macroeconomic indi-
cators is an important task for central banks.
Assessing the credit demand function1 is one of the most wide-spread methods of credit aggregate analy-
sis. T raditionally, this function represents the dependence of loans in real terms on a scale variable (normally,
GDP) and the cost of loans (the interest rate). The credit demand function can be used to assess a credit gap as
a deviation of the actual loans from the value calculated with the help of the dynamic simulation of the model.
Another traditional method to assess the credit gap is to find a deviation of the loan-to-GDP ratio from the trend
calculated with the help of the Hodrick-Prescott filter (λ=1600).
Credit gaps calculated by alternative methods had similar dynamics in the pre-crisis period as a whole and
demonstrated rapid growth in 2006-2007. In the crisis and post-crisis periods, however, the differences be -
tween the two indicators became more noticeable. Specifically, the contraction of the loan-to-GDP ratio caused
this indicator’s considerable deviation from the trend and resulted in the current negative value of the credit gap
calculated by the filtration method. At the same time, the credit gap calculated using the credit demand function
suggests that the post-crisis decline in credit activity generally corresponded to fundamental macroeconomic
indicators. Another significant difference is that the current values of the credit gap calculated using the credit
demand function are positive, which suggests banks’ excessive lending activities.
1 See “Assessment of the level of the demand for loans in the Russian economy,” Bank of Russia, Quarterly Inflation Review,
Q1 2010, pp. 25-26.
Actual and “equilibrium” change
in loan-to-GDP ratio
(four quarters growth, percentage points)
Range of "equilibrium" loan-to-GDP ratio growth estimates
Actual loan-to-GDP ratio growth
-10
Source: Bank of Russia calculations.
Monetary Conditions
2012 Q1 27
One of the shortcomings of these credit gaps is that both the trend trajectory and the parameters of the
credit demand function are calculated relying exclusively on the previous dynamics of credit aggregates. There-
fore, estimates may be biased and their interpretation may be complicated, if the loan growth was actually
unbalanced during a considerable period of the time sample. One of the solutions to this problem offered by
world practice is to parameterise the relationship between loans and other basic macroeconomic indicators using
historical data on developed countries (they are presumably less exposed to the problem) and only then employ
estimated models for credit activity analysis in transition economies. Such research2 was conducted by the ECB
specialists for Central and Eastern Europe. On the basis of 5 models3 from among those proposed in this paper,
an “equilibrium” change in the ratio of loans to GDP in Russia was assessed.
It can be noted that the actual loan-to-GDP ratio dynamics in 2001-2005 corresponded as a whole to the
estimated “equilibrium” dynamics. However, beginning with 2006, the growth of the loan-to-GDP ratio ac -
celerated noticeably and considerably exceeded the “equilibrium” growth in the pre-crisis period. These results
look meaningful and, generally point to the possibility of applying this approach for analysing lending activity in
Russia. Currently, the rates of growth in the loan-to-GDP ratio are again close to exceeding the equilibrium level.
2 For details, see Egert, B., P . Backe and T . Zumer. 2006. Credit Growth in Central and Eastern Europe: New (Over) shooting
stars? ECB Working Paper No. 687.
3 The models used in this paper are equations of the dependence of the loan-to-GDP ratio on certain macroeconomic indica-
tors: GDP , GDP based on PPP per capita, the loans to the government sector, the interest rate on loans, the spread between
lending and deposit rates and the inflation rate.
28 2012 Q1
Bank of Russia press releases on monetary policy measures
February 2012
February 3 (extract from the press release)
The Bank of Russia External and Public Relations Department informs that the Bank of Russia Board
of Directors took a decision on February 3, 2012 to leave the refinancing rate and interest rates on Bank of
Russia operations unchanged (see the Table ‘Interest Rates on Bank of Russia Operations’).
The decision was made following an assessment of inflation risks and risks to the slowing of economic
growth, including risks posed by the persisting uncertainty over external economic developments.
Inflation slowed down considerably in January 2012: the annual consumer price growth rate fell to
an estimated 4.1% as of January 30 from 6.1% at the end of 2011, as the government rescheduled the
planned increase in most of the administered prices and tariffs for mid-2012. The Bank of Russia takes
account of the temporality of this effect and will continue being guided by mid-term inflation forecasts in
taking monetary policy decisions. The appreciation of the ruble in January may have a certain disinflation
effect.
The dynamics of the key macroeconomic indicators in December suggested that consumption indica-
tors remained stable amid moderate industrial sector indicators. Further contraction of the unemployment
rate, accelerated growth rates in real incomes and continued growth in consumer lending contributed to
the acceleration of retail trade turnover growth rates. Annual growth rates in fixed capital investments
increased in December. Meanwhile, the annual growth of industrial output index decreased considerably
as against November , which was conditioned in part by the decrease in specific components of the index
through weather factors. Low industrial output growth rates and relatively weak sentiment indicators of
economic agents have remained unchanged over the recent months.
Given the current internal and external macroeconomic trends, the Bank of Russia regards the estab-
lished level of interest rates in the money market within the interest rate band as acceptable to secure a
balance between inflation risks and economic slowdown risks in the coming months. The Bank of Russia
will continue monitoring the effect of tightening the monetary conditions connected with the effect of
the transition to liquidity shortage in the banking sector amid a decrease in lending in external financial
markets.
The next meeting of the Bank of Russia Board of Directors to consider monetary policy is scheduled
for the first half of March 2012.
February 6
The Bank of Russia External and Public Relations Department informs that the Bank of Russia Board
of Directors took a decision on February 3, 2012 to approve the following list of national rating agencies
whose ratings are used by the Bank of Russia pursuant to Bank of Russia Ordinance No. 2732 U, dated
November 17, 2011, ‘On the Specifics for Credit Institutions to Make Provisions for Possible Losses on
Operations with Securities whose Title is Certified by Institutions (Depositaries) ’ (hereinafter referred to as
the Bank of Russia Ordinance) to assess the compliance by the institutions (depositaries) with the criteria
set forth in the Bank of Russia Ordinance, as well as minimum long-term credit ratings for each of the na-
tional rating agencies eligible for the foregoing list:
Bank of Russia press releases on monetary policy measures
2012 Q1 29
No. National rating agency Minimum long-term credit rating
1 RusRating ‘BB’
2 Expert RA ‘A’
3 National Rating Agency ‘A’
4 AK&M rating agency ‘A’
5 Moody’s Interfax rating agency ‘A2.ru’
March 2012
March 13 (extract from the press release)
The Bank of Russia External and Public Relations Department informs that the Bank of Russia Board
of Directors took a decision on March 13, 2012 to leave the refinancing rate and interest rates on Bank of
Russia operations unchanged (see the Table ‘Interest Rates on Bank of Russia Operations’).
The decision was made following an assessment of inflation risks and the prospects of economic
growth, taking into account the persisting uncertainty with regard to external economic developments.
Inflation continued to slow down in February and early March 2012: the annual consumer price
growth rate fell to an estimated 3.7% as of March 5. Core inflation also decreased, falling to 5.7% at end-
February. The inflation slowdown was facilitated by the government’s decision to reschedule for mid-2012
the planned increase in most of the administered prices and tariffs and also by the ruble’s appreciation in
the past few months. The Bank of Russia will continue being guided by mid-term inflation forecasts in tak-
ing monetary policy decisions.
The dynamics of the key macroeconomic indices in January suggested that consumption indicators
continued to grow faster than production indicators. The rates of growth in real wages remained high,
which was facilitated by real wage dynamics in the government sector , while the unemployment rate re-
mained relatively low. Consumer lending continued to grow rapidly. Meanwhile, industrial production has
registered moderate growth rates and the sentiment indicators of economic agents have been relatively
weak in the past few months.
Given the current internal and external macroeconomic trends, the Bank of Russia regards the estab-
lished level of interest rates in the money market within the interest rate band as acceptable in the coming
months. The Bank of Russia will continue monitoring money market developments amid a decrease in
lending in external financial markets.
The next meeting of the Bank of Russia Board of Directors to consider monetary policy is scheduled to
take place in the first ten days of April 2012.
March 28 (extract from the press release)
In compliance with a decision taken by the Bank of Russia Monetary Policy Committee (Minutes No.
3 of March 23, 2012), the Bank of Russia will restart 12-month Lombard loan and repo auctions.
March 30
The Bank of Russia External and Public Relations Department informs that from April 2, 2012, the
Bank of Russia will:
– resume operations to extend loans to credit institutions secured by non-market assets or guar -
antees with maturities from 181 to 365 calendar days in compliance with Bank of Russia Regulation No.
312-P dated November 12, 2007, ‘On the Procedure for Extending Bank of Russia Loans Secured by As-
sets or Guarantees to Credit Institutions;’
– start operations to extend gold-secured loans to credit institutions in compliance with Bank of
Russia Regulation No. 362-P dated November 30, 2010, ‘On the Procedure for Extending Bank of Rus -
sia Gold-Secured Loans to Credit Institutions,’ with maturities from 181 to 365 calendar days, with the
30 2012 Q1
interest rate on these loans set at 7.75% p.a. in accordance with a decision by the Bank of Russia Board of
Directors dated March 30, 2012.
April 2012
April 9 (extract from the press release)
The Bank of Russia External and Public Relations Department informs that the Bank of Russia Board of
Directors took a decision on April 9, 2012 to leave the refinancing rate and interest rates on Bank of Russia
operations unchanged (see the Table ‘Interest Rates on Bank of Russia Operations’).
The decision was made following an assessment of inflation risks and the prospects of economic
growth.
The annual inflation rate remained low at 3.7% in March, while core inflation slowed down to 5.5%.
These trends are expected to be short-lived, while medium-term inflationary risks are intensified by un -
certainty about the impact of the increase in most administered prices and tariffs scheduled for July on
consumer prices.
The dynamics of certain macroeconomic indicators in February suggest some improvement in the
economic situation. Industrial production growth accelerated and the annual growth rates of fixed capital
investment remained high. The dynamics of real wages and consumer lending, and also the low unem -
ployment rate create favourable conditions for the persistence of steady consumer demand.
The Bank of Russia Board of Directors also took a decision to set from April 10, 2012, the maximum
rate on 1-week deposit auctions at 4.75% p.a. This decision, which adds a short-term liquidity absorption
market instrument to the system of the Bank of Russia’s monetary tools, will help reduce money market
rate volatility and raise the efficiency of the Bank of Russia’s interest rate policy.
Given the current internal and external macroeconomic trends, the Bank of Russia regards the estab-
lished level of interest rates in the money market within the interest rate band as acceptable in the months
to come. The Bank of Russia will continue monitoring inflationary risks and will be guided by mid-term
inflation forecasts and inflation expectation dynamics in taking monetary policy decisions
The next meeting of the Bank of Russia Board of Directors to consider monetary policy is scheduled
for the first half of May 2012.
April 9 (extract from the press release)
The Bank of Russia External and Public Relations Department informs that from April 10, 2012, the
system of Bank of Russia monetary policy instruments will be supplemented by 1-week deposit auctions,
with their maximum interest rate set at 4.75% p.a. in accordance with a decision taken by the Bank of
Russia Board of Directors on April 9, 2012.
The Bank of Russia intends to give up conducting unconditionally 1-week repo auctions and, starting
from April 17, 2012, will hold on Tuesdays either liquidity provision auctions (repo and Lombard loan auc-
tions) or liquidity absorption auctions (deposit auctions) for a term of 1 week.
These decisions are designed to help reduce money market rate volatility and raise the efficiency of
the Bank of Russia’s interest rate policy.
1-week auctions will be held on Tuesdays with settlements on Wednesday. The Bank of Russia will
announce decisions on the auction direction on Mondays by 18:00 Moscow time and the corresponding
liquidity provision (absorption) limit on Tuesdays by 10:15 a.m. Moscow time. The Bank of Russia will take
these decisions pursuant to a banking sector liquidity forecast for a forthcoming week, which will include
an assessment of banks’ demand and liquidity supply influenced by autonomous and other factors.
Also from April 17, 2012, the Bank of Russia will do the following:
– suspend conducting 1-week and spot-week deposit operations at fixed rates on standard terms
and providing 1-week Lombard loans at fixed rates;
– the Bank of Russia will take into account bids filed at a rate above or equal to the fixed rate on
1-week repo operations to calculate the use of limit on the maximum volume of funds at 1-week repo
auction.
2012 Q1 31
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 1.6 0.5 1.4 0.8 7.2 0.2 0.3 3.9
February 0.9 0.5 1.3 0.8 5.6 0.3 0.3 1.0
March 0.6 0.5 1.0 0.7 4.2 0.4 0.4 0.4
April 0.3 0.2 0.3 0.2 1.1 0.3 0.3 0.2
May 0.5 0.1 0.7 -0.1 7.2 0.4 0.3 0.4
June 0.4 0.2 0.5 0.0 4.6 0.2 0.2 0.4
July 0.4 0.4 0.3 0.4 -0.6 0.3 0.2 0.6
August 0.6 0.7 0.9 1.2 -1.4 0.4 0.4 0.3
September 0.8 1.1 1.6 1.8 0.2 0.6 0.6 0.0
October 0.5 0.8 0.7 1.0 -1.8 0.6 0.7 0.0
November 0.8 0.7 1.4 1.0 4.0 0.7 0.7 0.2
December 1.1 0.7 2.0 1.2 8.6 0.5 0.4 0.4
Full year (December on December) 8.8 6.6 12.9 9.4 45.6 5.0 4.9 8.1
January 2.4 1.1 2.6 1.6 11.2 0.9 0.6 4.1
February 0.8 0.7 1.2 1.0 2.7 0.3 0.5 0.8
March 0.6 0.7 0.9 0.9 1.4 0.5 0.6 0.3
April 0.4 0.5 0.4 0.6 -1.6 0.5 0.5 0.5
May 0.5 0.4 0.0 0.2 -1.6 0.8 0.4 0.7
June 0.2 0.3 -0.2 0.1 -3.2 0.4 0.3 0.7
July 0.0 0.4 -0.7 0.4 -9.2 0.3 0.3 0.6
August -0.2 0.4 -1.4 0.3 -16.0 0.5 0.4 0.3
September 0.0 0.5 -0.6 0.2 -9.8 0.7 0.7 -0.1
October 0.5 0.5 0.5 0.5 0.5 0.7 0.7 0.1
November 0.4 0.5 0.5 0.7 -1.0 0.6 0.5 0.1
December 0.4 0.4 0.7 0.6 1.3 0.3 0.4 0.3
Full year (December on December) 6.1 6.6 3.9 7.4 -24.7 6.7 6.0 8.7
January 0.5 0.5 0.8 0.6 2.8 0.4 0.5 0.2
February 0.4 0.4 0.7 0.5 2.1 0.3 0.4 0.0
March 0.6 0.5 0.8 0.6 2.7 0.5 0.5 0.4
1 Excluding vegetables and fruit.
2 Bank of Russia estimate.
Note. T ables 1 to 7 are based on Rosstat data and Bank of Russia calculations.
32 2012 Q1
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 1.6 0.5 1.4 0.8 7.2 0.2 0.3 3.9
February 2.5 1.0 2.7 1.6 13.2 0.5 0.6 5.0
March 3.2 1.5 3.8 2.3 18.0 0.9 1.0 5.4
April 3.5 1.7 4.1 2.5 19.3 1.3 1.3 5.6
May 4.0 1.8 4.8 2.4 27.9 1.7 1.7 6.0
June 4.4 2.0 5.4 2.4 33.8 1.9 1.9 6.4
July 4.8 2.4 5.7 2.8 32.9 2.2 2.1 7.0
August 5.4 3.1 6.6 4.1 31.0 2.5 2.5 7.3
September 6.2 4.3 8.4 5.9 31.3 3.1 3.1 7.4
October 6.8 5.1 9.1 7.0 28.9 3.8 3.8 7.4
November 7.6 5.8 10.6 8.1 34.0 4.5 4.5 7.6
December 8.8 6.6 12.9 9.4 45.6 5.0 4.9 8.1
January 2.4 1.1 2.6 1.6 11.2 0.9 0.6 4.1
February 3.2 1.8 3.9 2.6 14.2 1.2 1.1 4.9
March 3.8 2.5 4.8 3.5 15.8 1.7 1.7 5.2
April 4.3 3.0 5.2 4.1 14.0 2.2 2.2 5.7
May 4.8 3.4 5.2 4.4 12.2 3.0 2.6 6.5
June 5.0 3.8 5.0 4.5 8.7 3.5 2.9 7.2
July 5.0 4.1 4.2 4.9 -1.3 3.8 3.2 7.9
August 4.7 4.6 2.8 5.2 -17.1 4.3 3.6 8.2
September 4.7 5.1 2.1 5.5 -25.2 5.0 4.3 8.1
October 5.2 5.6 2.7 6.0 -24.9 5.7 5.1 8.3
November 5.6 6.2 3.2 6.7 -25.7 6.3 5.7 8.4
December 6.1 6.6 3.9 7.4 -24.7 6.7 6.0 8.7
January 0.5 0.5 0.8 0.6 2.8 0.4 0.5 0.2
February 0.9 0.9 1.5 1.1 5.0 0.8 0.9 0.2
March 1.5 1.4 2.3 1.7 7.8 1.2 1.4 0.6
1 Excluding vegetables and fruit.
2 Bank of Russia estimate.
Statistical Addendum
2012 Q1 33
Table 3
Consumer prices by group of goods and services
(month on corresponding month of previous year, %)
Monthly
inflation
Core
inflation 1
Food price
growth
Food price
growth 2
Vegetable
and fruit price
growth
Non-food
price growth
Growth in non-
food prices,
excluding petrol
prices 1
Service price
growth
January 8.0 7.6 6.1 6.6 0.7 9.1 9.0 9.1
February 7.2 6.3 5.5 5.8 1.4 7.7 7.4 8.7
March 6.5 5.4 4.8 5.1 1.1 6.6 6.1 8.4
April 6.0 4.8 4.4 4.5 2.4 5.9 5.2 8.4
May 6.0 4.4 4.4 4.1 5.4 5.7 4.7 8.4
June 5.8 4.3 4.5 4.0 6.1 5.1 4.6 8.4
July 5.5 4.3 4.2 4.2 2.1 4.8 4.6 8.2
August 6.1 4.6 6.1 5.1 13.1 4.5 4.5 8.0
September 7.0 5.3 8.7 6.5 28.0 4.4 4.6 8.0
October 7.5 5.8 10.0 7.6 33.9 4.4 4.5 8.1
November 8.1 6.2 11.2 8.5 38.0 4.7 4.8 8.1
December 8.8 6.6 12.9 9.4 45.6 5.0 4.9 8.1
January 9.6 7.2 14.2 10.2 51.1 5.6 5.2 8.2
February 9.5 7.4 14.2 10.5 46.9 5.6 5.4 7.9
March 9.5 7.7 14.1 10.8 42.9 5.8 5.6 7.9
April 9.6 8.0 14.1 11.2 39.1 5.9 5.8 8.2
May 9.6 8.3 13.4 11.6 27.7 6.3 5.9 8.6
June 9.4 8.4 12.5 11.7 18.3 6.6 5.9 8.8
July 9.0 8.4 11.3 11.7 8.1 6.6 6.0 8.9
August 8.2 8.1 8.8 10.7 -7.9 6.8 6.1 9.0
September 7.2 7.4 6.4 8.9 -17.1 6.8 6.1 8.8
October 7.2 7.2 6.2 8.4 -15.2 6.9 6.2 9.0
November 6.8 6.9 5.3 8.0 -19.3 6.8 6.1 8.8
December 6.1 6.6 3.9 7.4 -24.7 6.7 6.0 8.7
January 4.2 6.0 2.0 6.3 -30.4 6.2 5.9 4.7
February 3.7 5.7 1.5 5.8 -30.8 6.2 5.8 3.9
March 3.7 5.5 1.3 5.5 -29.9 6.2 5.7 3.9
1 Bank of Russia estimate.
2 Excluding vegetables and fruit.
34 2012 Q1
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 0.3 0.1 1.0 0.3 1.6 0.4 1.2
February 0.6 0.2 1.3 0.5 2.5 0.8 1.7
March 0.8 0.3 1.4 0.6 3.2 1.2 2.0
April 0.9 0.5 1.4 0.7 3.5 1.4 2.1
May 0.8 0.6 1.5 1.0 4.0 1.5 2.5
June 0.8 0.7 1.7 1.2 4.4 1.6 2.8
July 1.0 0.8 1.8 1.2 4.8 1.9 2.8
August 1.4 0.9 1.9 1.1 5.4 2.5 2.8
September 2.0 1.1 1.9 1.1 6.2 3.5 2.8
October 2.4 1.4 1.9 1.0 6.8 4.1 2.7
November 2.8 1.6 2.0 1.2 7.6 4.7 2.9
December 3.3 1.8 2.1 1.6 8.8 5.3 3.5
January 0.5 0.3 1.1 0.4 2.4 0.8 1.5
February 0.9 0.4 1.3 0.6 3.2 1.4 1.7
March 1.2 0.6 1.4 0.7 3.8 2.0 1.8
April 1.4 0.8 1.5 0.6 4.3 2.4 1.8
May 1.5 1.1 1.7 0.5 4.8 2.7 2.0
June 1.6 1.2 1.9 0.4 5.0 3.0 2.0
July 1.7 1.3 2.0 -0.1 5.0 3.3 1.7
August 1.8 1.5 2.1 -0.7 4.7 3.6 1.1
September 1.9 1.8 2.1 -1.1 4.7 4.1 0.6
October 2.1 2.0 2.1 -1.0 5.2 4.5 0.7
November 2.3 2.2 2.2 -1.1 5.6 4.9 0.7
December 2.5 2.4 2.3 -1.0 6.1 5.3 0.8
January 0.2 0.2 0.1 0.1 0.5 0.4 0.1
February 0.4 0.3 0.0 0.2 0.9 0.7 0.1
March 0.6 0.5 0.2 0.3 1.5 1.1 0.3
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
2012 Q1 35
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 0.3 0.1 1.0 0.3 1.6 0.4 1.2
February 0.3 0.1 0.3 0.2 0.9 0.4 0.5
March 0.2 0.1 0.1 0.2 0.6 0.4 0.3
April 0.1 0.1 0.1 0.0 0.3 0.2 0.1
May 0.0 0.1 0.1 0.3 0.5 0.1 0.4
June 0.0 0.1 0.1 0.2 0.4 0.2 0.3
July 0.1 0.1 0.2 0.0 0.4 0.3 0.1
August 0.4 0.1 0.1 -0.1 0.6 0.6 0.0
September 0.6 0.2 0.0 0.0 0.8 0.9 -0.1
October 0.4 0.2 0.0 -0.1 0.5 0.6 -0.1
November 0.3 0.2 0.1 0.2 0.8 0.6 0.3
December 0.4 0.2 0.1 0.4 1.1 0.6 0.5
January 0.5 0.3 1.1 0.4 2.4 0.8 1.5
February 0.3 0.1 0.2 0.2 0.8 0.6 0.2
March 0.3 0.2 0.1 0.1 0.6 0.6 0.1
April 0.2 0.2 0.1 -0.1 0.4 0.4 0.0
May 0.1 0.3 0.2 -0.1 0.5 0.3 0.2
June 0.0 0.1 0.2 -0.1 0.2 0.3 0.0
July 3 0.0
August 3 -0.2
September 3 0.0
October 0.2 0.3 0.0 0.0 0.5 0.4 0.1
November 0.2 0.2 0.0 0.0 0.4 0.4 0.0
December 0.2 0.1 0.1 0.0 0.4 0.3 0.1
January 0.2 0.2 0.1 0.1 0.5 0.4 0.1
February 0.2 0.1 0.0 0.1 0.4 0.3 0.0
March 0.2 0.2 0.1 0.1 0.6 0.4 0.2
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.
3 Owing to zero or negative inflation, estimates may vary.
36 2012 Q1
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 17.3 4.7 61.6 16.3 25.6 74.4
February 22.2 7.3 51.4 19.1 31.6 68.4
March 25.2 10.4 43.9 20.6 37.4 62.6
April 25.0 13.2 41.7 20.2 39.8 60.2
May 20.9 15.3 38.5 25.3 37.2 62.8
June 19.0 15.8 37.5 27.7 37.2 62.8
July 20.5 16.6 38.0 24.9 40.4 59.6
August 26.4 17.3 35.4 20.9 47.1 52.9
September 32.9 18.3 30.6 18.2 55.5 44.5
October 35.9 20.5 28.2 15.5 60.5 39.5
November 36.7 21.6 25.7 16.1 61.5 38.5
December 37.0 20.6 23.7 18.7 60.3 39.7
January 23.1 13.7 45.7 17.6 35.4 64.6
February 28.0 13.4 39.8 18.7 44.8 55.2
March 31.4 15.8 35.5 17.3 52.0 48.0
April 33.3 18.2 34.8 13.7 56.8 43.2
May 31.5 22.5 35.2 10.7 57.3 42.7
June 31.0 24.5 37.3 7.3 59.8 40.2
July 33.6 26.7 40.8 -1.1 66.0 34.0
August 37.8 32.2 45.0 -15.1 76.8 23.2
September 39.9 37.7 44.9 -22.5 86.3 13.7
October 39.6 39.2 41.2 -20.0 86.7 13.3
November 40.7 39.8 38.5 -19.0 87.4 12.6
December 41.3 38.7 36.9 -16.9 86.5 13.5
January 36.7 30.5 10.3 22.5 79.5 20.5
February 42.3 32.6 5.5 19.6 82.9 17.1
March 39.7 31.3 10.6 18.4 77.2 22.8
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
2012 Q1 37
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 17.3 4.7 61.6 16.3 25.6 74.4
February 30.6 11.7 33.6 24.1 42.2 57.8
March 36.4 22.1 15.4 26.0 59.6 40.4
April 23.4 42.8 18.0 15.8 65.3 34.7
May -5.6 29.1 18.0 58.5 20.5 79.5
June 0.9 20.8 28.1 50.2 36.6 63.4
July 38.7 26.1 43.8 -8.5 79.6 20.4
August 75.8 22.8 13.2 -11.8 102.9 -2.9
September 72.6 25.0 1.4 1.0 107.1 -7.1
October 71.1 46.0 -0.8 -16.3 119.3 -19.3
November 42.4 30.1 6.3 21.2 68.8 31.2
December 38.8 14.2 10.8 36.2 52.4 47.6
January 23.1 13.7 45.7 17.6 35.4 64.6
February 42.7 12.7 22.4 22.2 72.9 27.1
March 48.1 27.7 14.0 10.3 87.5 12.5
April 48.8 38.8 29.1 -16.7 96.9 3.1
May 16.9 59.7 38.3 -14.9 61.7 38.3
June 19.7 64.0 79.1 -62.7 110.0 -10.0
July 3
August 3
September 3
October 37.0 52.5 7.6 2.9 89.4 10.6
November 54.5 47.2 5.6 -7.3 95.5 4.5
December 48.0 24.7 18.1 9.2 76.0 24.0
January 36.7 30.5 10.3 22.5 79.5 20.5
February 49.7 35.5 -0.9 15.7 87.4 12.6
March 35.8 29.4 18.1 16.7 68.7 31.3
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.
3 Owing to zero or negative inflation, estimates may vary.
38 2012 Q1
Year Q1 Q2 Q3 Q4
Macroeconomic indicators
GDP
over period since start of year. billions of rubles
2009 8,335 17,580 27,991 38,807
2010 9,617 20,310 32,154 45,173
2011 11,680 24,718 39,124 54,586
over period since start of year, as % of corresponding period of previous
year
2009 90.8 … … 92.2
2010 103.8 … … 104.3
2011 104.0 … … 104.3
as % of corresponding quarter of previous year
2009 90.8 88.8 91.4 97.4
2010 103.8 104.9 103.8 104.9
2011 104.0 103.4 105.0 104.8
Industrial output index
as % of corresponding quarter of previous year
2010 109.5 110.9 106.4 106.5
2011 105.9 104.8 105.1 103.3
2012 104.0
over period since start of year, as % of corresponding period of previous
year
2010 109.5 110.2 108.9 108.2
2011 105.9 105.3 105.2 104.7
2012 104.0
Agricultural output
as % of corresponding quarter of previous year
2010 100.5 98.6 79.2 96.2
2011 100.7 100.6 126.1 132.6
2012 104.0
over period since start of year, as % of corresponding period of previous
year
2010 100.5 … … 88.7
2011 100.7 100.7 118.2 122.1
2012 104.0
Fixed capital investment
over period since start of year, billions of rubles
2010 1,242.9 3,205.4 5,566.9 9,152.1
2011 1,353.0 3,598.0 6,371.1 10,776.8
2012 1,609.7
as % of corresponding quarter of previous year
2010 95.2 105.6 105.3 111.1
2011 99.2 105.0 108.2 113.6
2012 111.2
Retail trade turnover
over period since start of year, billions of rubles
2010 3,631.0 7,571.5 11,784.1 16,499.0
2011 4,180.1 8,748.4 13,643.4 19,082.6
2012 4,666.1
as % of corresponding quarter of previous year
2010 102.3 106.9 108.5 107.5
2011 105.0 105.7 107.9 109.0
2012 107.5
Federal budget on accrual
basis, as of end of period
revenue
billions of rubles
2010 1,954.9 3,997.9 6,008.6 8,305.4
2011 2,392.8 5,306.4 8,213.0 11,366.0
2012 2,966.3
as % of GDP
2010 20.3 19.7 18.7 18.4
2011 20.5 21.5 21.0 20.8
2012 23.0,1
expenditure
billions of rubles
2010 2,199.5 4,386.2 6,701.2 10,117.4
2011 2,214.7 4,602.9 7,082.1 10,935.2
2012 3,036.5
as % of GDP
2010 22.9 21.6 20.8 22.4
2011 19.0 18.6 18.1 20.0
2012 23.6,1
surplus(+)/
deficit(-)
billions of rubles
2010 -244.6 -388.3 -692.6 -1,812.0
2011 178.0 703.5 1,130.9 430.8
2012 -70.2
as % of GDP
2010 -2.5 -1.9 -2.2 -4.0
2011 1.5 2.8 2.9 0.8
2012 ,-0.5,1
General government budget
on accrual basis, as of end
of period
revenue
billions of rubles
2010 3,463.1 7,603.5 11,419.4 16,031.9
2011 4,392.5 9,885.1 15,170.8 20,853.7
2012 5,103.5
as % of GDP
2010 36.0 37.4 35.5 35.5
2011 37.6 40.0 38.8 38.2
2012 39.7,1
expenditure
billions of rubles
2010 3,220.7 7,331.2 11,309.8 17,616.6
2011 3,575.4 8,138.7 12,745.4 20,004.8
2012 4,583.6
as % of GDP
2010 33.5 36.1 35.2 39.0
2011 30.6 32.9 32.6 36.6
2012 35.6,1
surplus(+)/
deficit(-)
billions of rubles
2010 242.4 272.3 109.7 -1,584.6
2011 817.0 1,746.4 2,425.4 848.8
2012 519.9
as % of GDP
2010 2.5 1.3 0.3 -3.5
2011 7.0 7.1 6.2 1.6
2012 4.0,1
Table 8
Russia’s key macroeconomic and financial indicators
Note. T able 8 is based on data compiled by the Bank of Russia, the Federal State Statistics Service, the Ministry of Finance of the
Russian Federation and the Federal T reasury.
Statistical Addendum
2012 Q1 39
Year Q1 Q2 Q3 Q4
Socio-economic indicators
Nominal imputed average
monthly per employee wage
rubles
2010 19,485 20,809 21,031 23,491
2011 21,354 23,154 23,352 26,905
2012 24,407
as % of corresponding quarter of previous year
2010 110.5 112.4 111.6 112.7
2011 111.2 112.5 112.2 115.7
2012 114.6
over period since start of year, as % of corresponding period of previous
year
2010 110.5 … … 112.4
2011 111.2 111.8 111.9 113.0
2012 114.6
Real imputed average monthly per employee wage, as % of corresponding quarter of previous year
2010 103.1 106.1 105.1 104.2
2011 101.6 102.7 103.8 108.5
2012 110.3
Household money income (per capita monthly average), rubles
2010 16,085.1 18,662.5 18,642.8 22,140.0
2011 17,673.2 20,308.8 20,564.1 24,304.6
2012 18,936.1
Household real disposable
money income
as % of corresponding quarter of previous year
2010 108.1 104.3 105.8 102.9
2011 100.2 98.7 101.4 102.8
2012 102.3
over period since start of year, as % of corresponding period of previous
year
2010 108.1 … … 105.1
2011 100.2 99.4 100.1 100.8
2012 102.3
Household spending, as % of
income
purchase of goods and payment for services
2010 72.9 68.1 72.4 67.2
2011 78.6 72.8 76.1 70.5
2012 80.5
obligatory payments and contributions
2010 9.4 9.7 10.1 10.1
2011 9.6 9.9 10.4 10.3
2012 10.2
growth in savings
2010 15.8 15.5 12.1 15.1
2011 10.6 11.0 6.8 12.4
2012 7.2
purchase of foreign currency
2010 3.2 3.2 4.1 4.0
2011 3.8 3.9 4.8 4.4
2012 5.3
cash on hand
2010 -1.3 3.5 1.3 3.6
2011 -2.6 2.4 1.9 2.4
2012 -3.2
Average imputed pension, total, rubles
2010 7,126 7,580 7,596 7,604
2011 8,011 8,254 8,263 8,284
2012 8,688
Real imputed pension
as % of corresponding quarter of previous year
2010 144.1 138.9 134.3 124.1
2011 102.7 99.4 100.6 102.1
2012 104.4
over period since start of year, as % of corresponding period of previous
year
2010 144.1 … … 134.8
2011 102.7 101.0 100.9 101.2
2012 104.4
Total number of unemployed
(calculated by ILO
methodology)
million
2010 6.6 5.6 5.2 5.2
2011 5.6 5.0 4.8 4.7
2012 4.9
as % of economically active population
2010 8.8 7.4 6.8 6.9
2011 7.5 6.6 6.2 6.3
2012 6.5
Table 8 (continued)
40 2012 Q1
Year Q1 Q2 Q3 Q4
Foreign economic activities
Price of Urals crude, over period since start of
year
$/barrel
2010 75.1 75.9 75.8 78.2
2011 102.6 108.3 109.7 109.6
2012 117.5
as % of corresponding period of previous year
2010 173.8 150.0 134.5 128.6
2011 136.6 142.7 144.7 140.1
2012 114.6
Exports of goods, over period since start of year
$ billion
2010 92.2 189.6 287.1 400.6
2011 113.2 246.9 377.3 522.0
2012 134.7 2
as % of corresponding period of previous year
2010 161.1 151.2 138.1 132.1
2011 122.8 130.2 131.4 130.3
2012 118.9 2
Imports of goods, over period since start of year
$ billion
2010 45.7 103.8 172.1 248.6
2011 65.1 148.1 233.3 323.8
2012 73.3 2
as % of corresponding period of previous year
2010 118.7 125.9 130.9 129.6
2011 142.5 142.7 135.6 130.2
2012 112.7 2
Current account balance (over period since start of year), $ billion
2010 33.7 52.0 57.7 71.1
2011 30.8 52.7 70.5 98.8
2012 42.3 2
Private sector net capital outflow (inflow) (over period since start of year), $ billion
2010 -15.1 -11.4 -14.4 -34.4
2011 -19.8 -27.1 -45.5 -80.5
2012 -35.1 2
Foreign investment in Russia’s non-financial sector
(Rosstat data), over period since start of year
$ billion
2009 12.0 32.2 54.7 81.9
2010 13.1 30.4 47.5 114.7
2011 44.3 87.7 133.8 190.6
as % of corresponding period of previous year
2009 69.7 69.1 72.2 79.0
2010 109.3 94.5 86.8 140.1
2011 3.4 times. 2.9 times 2.8 times. 166.1
of which:
direct
$ billion
2009 3.2 6.1 10.0 15.9
2010 2.6 5.4 8.2 13.8
2011 3.9 7.0 11.7 18.4
as % of corresponding period of previous year
2009 57.0 55.0 51.9 58.9
2010 82.4 89.0 82.2 86.8
2011 148.3 129.8 143.2 133.3
portfolio
$ billion
2009 0.1 0.9 1.0 0.9
2010 0.3 0.7 0.9 1.1
2011 0.1 0.2 0.5 0.8
as % of corresponding period of previous year
2009 93.5 74.9 78.6 62.3
2010 2.5 times 81.1 85.0 121.9
2011 41.8 34.5 61.8 74.9
other
$ billion
2009 8.7 25.2 43.7 65.1
2010 10.2 24.3 38.4 99.9
2011 40.3 80.4 121.5 171.4
as % of corresponding period of previous year
2009 75.6 73.5 79.1 86.5
2010 117.1 96.2 87.8 153.3
2011 3.9 times. 3.3 times 3.2 times 171.7
Russia's international reserves (as of end of period), $ billion
2010 447.4 461.2 490.1 479.4
2011 502.5 524.5 516.8 498.6
2012 513.5
Real ruble exchange rate index (last month of
quarter), growth as % of December of previous
year3
rubles per US dollar
2010 3.6 -0.7 2.0 4.0
2011 10.5 12.4 2.4 1.1
2012 7.0
rubles per euro
2010 11.7 18.6 14.5 14.5
2011 5.2 4.6 -0.9 1.6
2012 7.2
effective rate
2010 7.4 9.7 6.8 6.9
2011 6.9 8.4 1.0 3.8
2012 6.2
Table 8 (continued)
Statistical Addendum
2012 Q1 41
Year Q1 Q2 Q3 Q4
Financial market indicators (including Sberbank interest rates)
Average for period
Overnight interbank credit rate,
% p. a.
in,rubles
2010 4.2 3.1 2.6 2.9
2011 2.8 3.6 4.1 5.1
2012 4.7
in US dollars
2010 0.2 0.3 0.3 0.3
2011 0.2 0.2 0.2 0.2
2012 0.2
OFZ yields, % p. a.4
2010 7.4 6.9 6.6 6.8
2011 6.9 6.9 7.5 8.0
2012 7.5
Interest rate on household
time deposits, % p. a.
up to 1 year in rubles
2010 8.5 7.1 6.0 5.6
2011 5.3 5.1 5.1 6.4
2012 6.6
over 1 year in rubles
2010 7.7 6.2 5.3 4.8
2011 5.6 5.6 6.0 6.9
2012 7.6
up to 1 year in US dollars
2010 4.3 3.7 3.6 3.7
2011 3.5 3.1 3.1 3.5
2012 3.5
over 1 year in US dollars
2010 4.9 4.8 4.4 4.7
2011 4.5 4.6 4.2 4.7
2012 4.7
Interest rate on loans to non-
financial organisations, % p. a.
up to 1 year in rubles
2010 12.8 11.4 10.0 9.1
2011 8.7 8.3 8.0 8.9
2012 9.0
over 1 year in rubles
2010 13.9 12.3 11.4 10.5
2011 10.6 10.5 10.3 10.1
2012 11.2
up to 1 year in US dollars
2010 8.3 7.5 6.9 6.1
2011 6.2 4.4 4.7 5.3
2012 6.4
over 1 year in US dollars
2010 10.3 8.8 7.4 8.0
2011 7.3 7.3 7.2 7.5
2012 7.7
Interest rate on ruble-denominated promissory notes issued by non-financial organisations and discounted
by credit institutions, % p. a.
2010 14.1 11.6 10.8 10.2
2011 8.4 10.0 8.9 9.4
2012 11.5
Interest rate on ruble-denominated promissory notes issued by credit institutions and discounted by cred-
it institutions, % p. a.
2010 9.3 7.8 7.4 7.5
2011 7.4 7.5 8.4 8.3
2012 8.7
MICEX rate in 'tomorrow' trades, ruble/US dollars
2010 29.8318 30.2891 30.6072 30.7248
2011 29.1281 27.9951 29.1545 31.2231
2012 30.1726
As of end of quarter
RTS index, points
2010 1,572.48 1,339.35 1,507.66 1,770.28
2011 2,044.20 1,906.71 1,341.09 1,381.87
2012 1,637.73
Refinancing rate, % p. a.
2010 8.25 7.75 7.75 7.75
2011 8.00 8.25 8.25 8.00
2012 8.00
Table 8 (continued)
42 2012 Q1
Table 8 (end)
Year 1.01 1.04 1.07 1.10
Monetary indicators
M0, billions of rubles
2010 4,038.1 3,986.1 4,367.7 4,524.5
2011 5,062.7 4,918.2 5,192.2 5,420.4
2012 5,938.6 5,704.3
M2, billions of rubles
2010 15,267.6 15,639.4 16,900.9 17,690.2
2011 20,011.9 19,819.0 20,745.3 21,497.4
2012 24,543.4 24,041.3
Broad money, billions of rubles
2010 19,095.8 19,309.7 20,557.1 21,318.6
2011 23,791.2 23,641.1 24,455.0 25,680.3
2012 28,814.9 28,411.8
Net foreign assets, billions of rubles
2010 13,942.7 13,816.0 14,814.0 15,119.3
2011 15,041.2 15,025.3 15,599.9 17,514.6
2012 17,281.9 16,646.5
Domestic claims, billions of rubles
2010 13,241.8 13,460.4 14,097.3 15,003.0
2011 17,468.2 17,005.1 17,234.7 18,635.9
2012 22,195.9 21,998.3
Broad monetary base, billions of rubles
2010 6,467.3 6,363.9 7,195.0 7,126.0
2011 8,190.3 7,514.2 7,410.3 7,407.9
2012 8,644.1 7,787.8
Balances of correspondent accounts, billions of rubles
2010 900.3 579.5 603.6 590.0
2011 994.7 597.2 786.5 781.6
2012 981.6 812.5
Monetisation of the economy (by M2 aggregate), %
2010 32.7 33.6 35.0 36.3
2011 37.3 37.8 38.0 37.9
2012 38.2 39.1 1
Money multiplier
by broad monetary base
2010 2.36 2.46 2.35 2.48
2011 2.44 2.64 2.80 2.90
2012 2.84 3.09
change since start of year, %
2010 1.5 5 4.1 -0.5 5.2
2011 3.5 5 7.9 14.6 18.8
2012 16.2 5 8.7
Foreign exchange rates
rubles per US dollar
2010 30.19 29.50 31.26 30.51
2011 30.35 28.52 27.87 32.11
2012 32.20 29.33
rubles per euro
2010 43.46 39.57 38.21 41.44
2011 40.49 40.39 40.42 43.42
2012 41.67 39.17
1 Preliminary data.
2 Estimate.
3 (+) signifies appreciation of the ruble, (-) signifies depreciation of the ruble.
4 The average-weighted effective yield of the most liquid OFZ bond issues measured by the volume of bonds in circulation and the terms to redemption (calculated by the MICEX, since
December 2011 – by the MICEX-RTS).
5 Relative to beginning of previous year.
Statistical Addendum
2012 Q1 43
Table 9
Bank of Russia interest rates1 in January-April 2012
Purpose Type of instrument Instrument Period Interest rate,
% p. a.
Providing liquidity
Standing facilities
(fixed rates)
Overnight loans 2 1 day 8.00
Currency swap operations 3 1 day 8.00
Repo, Lombard loans 1 day 6.25
Lombard loans
7 days4 6.25
30 days5 6.25
Repo
7 days 5 6.25
12 months 5 7.75
Loans secured by gold6
Up to 90 days 6.75
From 91 to 180 days 7.25
From 181 to 365 days6 7.75
Loans secured by non-market assets or guarantees
Up to 90 days 7.00
From 91 to 180 days 7.50
From 181 to 365 days7 8.00
Open market operations (minimum interest rates)
Repo auctions 1 day 5.25
Repo auctions, Lombard loan auctions
7 days 5.25
3 months 6.75
6 months5 7.25
12 months7 7.75
Absorbing liquidity
Standing facilities
(fixed rates) Deposit operations
demand, 1 day 4.00
7 days 4 4.00
Open market operations (maximum interest rates) Deposit auctions
7 days8 4.75
1 month 5.50
3 months5 6.50
Memo item:
Refinancing rate 8.00
1 Interest rates set by the Bank of Russia Board of Directors.
2 Provided pursuant to Bank of Russia Regulations No. 236-P, dated August 4, 2003, No. 312-P, dated November 12, 2007, and No. 362-P, dated November 30, 2010.
3 Interest rate to determine the minimum swap difference.
4 The operations were suspended from April 17, 2012.
5 The operations were suspended.
6 The interest was set from April 2, 2012.
7 The operations were resumed from April 2, 2012.
8 The interest rate was set from April 10, 2012.
44 2012 Q1
Table 11
Credit institutions’ required reserve ratios
(from November 1, 2009, up to present, %)
Required reserve ratio for
bank obligations to non-
resident legal entities in
Russian currency
Required reserve ratio for
bank obligations to non-
resident legal entities in
foreign currency
Required reserve ratio for
obligations to individuals in
Russian currency
Required reserve ratio for
obligations to individuals in
foreign currency
Required reserve ratio for
other bank obligations in
Russian currency
Required reserve ratio for
other bank obligations in
foreign currency
November 1, 2009 —
January 31, 2011 2,5
February 1, 2011 —
February 28, 2011 3,5 3,0 3,0
March 1, 2011 —
March 31, 2011 4,5 3,5 3,5
April 1, 2011 — 5,5 4,0 4,0
Table 10
Credit institutions’ required reserve ratios
(from July 1, 2007 to October 31, 2009, %)
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 1.0 1.0 1.0
June 1, 2009 —
June 30, 2009 1.5 1.5 1.5
July 1, 2009 —
July 31, 2009 2.0 2.0 2.0
August 1, 2009 —
October 31, 2009 2.5 2.5 2.5
© The Central Bank of the Russian Federation, 2012
Research and Information Department