Russian Economics - New Budget Rule Takes Further Aim at Oil Dependence
The Russian economy's dependence on the oil price has fallen over the past three years, but the government is seeking to reduce it even further. The new budget rule for the next years is designed to force the economy to operate as if the Urals oil price were close to $40-45/bbl, a rather conservative assumption. This will mean lower budget expenditures, a radical decrease in the breakeven oil price and increased interventions on the FX market. But it could also hinder the economic recovery, in our view.
Sberbank CIB Investment Research is a research firm offering equity, fixed income, economics, and strategy research. It covers analysis on all aspects of Russia’s capital markets, issues and industries. The firm analyzes trends in Russia and combines local knowledge with a global perspective. It processes macroeconomic data, market and company-specific news, stock quotes and other information for providing research reports. The firm provides details and latest prices on the most traded names and most traded paper on all segments Russian market. In strategy research, it provides thematic research, tips and descriptions of the methodology used to evaluate companies.
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