Judging by Russian central bank Governor Elvira Nabiullina’s recent comments at the annual meeting of the Association of Russian Banks (ARB), she is certainly not Ben Bernanke or Janet Yellen. It appears any comparison would likely insult her.
Nabiullina, who helped stabilize the ruble after it descended 50 percent, confirmed that the central bank will not be establishing any sort of quantitative easing efforts. Instead, the country will hone in on interest rates in order to boost the Russian economy, something that is suffering from a hardened recession.
Moving forward, the central bank will slash its 14 percent benchmark rate if inflation risks continue to pose a serious threat, said Nabiullina on Tuesday. Her current policies of tightening monetary policy countered intense inflation, devaluation projections and potential stagflation.
“There’s no reason to expect QE from us; our main instrument is the key rate,” Nabiullina said Tuesday, reports CNBC. “I understand the sincere wish both to make loans more accessible and to spur economic growth. I understand these goals but believe that the recipes used by many countries won’t work and will have the opposite effect in the conditions of our Russian economy.”
What’s interesting about Nabiullina’s remarks is that they were made in front of an organization that encouraged the government to initiate a QE program to boost the economy soon after sanctions from the United States and European Union were in place and oil prices started to decline.
As Economic Policy Journal‘s Robert Wenzel writes, “Nabiullina shouldn’t be considered the female equivalent of Joe Salerno running a central bank, but she is much better than the rest of the current lot of central bankers.”
Photo by www.kremlin.ru.
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