GDP held a meeting of the Council for Strategic Development and National Projects
Vladimir Putin commented on the situation on the foreign exchange market for the first time. Without speaking directly about the significant weakening of the ruble (by 30% compared to January), the president expressed concern about the high volatility of the exchange rate. She, in his opinion, interferes with citizens and businesses. Putin instructed the Central Bank to take more decisive measures — in particular, to limit speculative demand in the economy and control the outflow of capital. “The task of restraining price growth is coming to the fore,” VVP stressed. Another instruction to the government: by uniting with society and religious denominations, to achieve an increase in the birth rate and the savings of the people.
Vladimir Putin chaired a meeting of the Council for Strategic Development and National Projects on Tuesday evening. The president devoted most of his speech to assessing the current situation in the Russian economy. And in particular, for the first time he spoke about the dollar exchange rate, although this word itself was never heard from his lips. Putin noted that volatility has «significantly increased» in the financial markets in recent months. (In other words: “Obviously, such fluctuations make it difficult for business, enterprises, and citizens to make investment decisions,” he said, continuing to speak in Aesopian language. According to the head of state, in the current situation, the Bank of Russia should make more active use of the tools at its disposal «Here we need to work, among other things, on limiting unproductive, speculative demand in the economy, controlling capital outflow, monitoring the behavior of other financial market participants,» VVP explained. are included in the direct functions of the Central Bank.
Putin confirmed that he had recently discussed the situation on the foreign exchange market and measures to stabilize the national currency with some colleagues. As some media reported, the meeting with the participation of the president, the head of the Central Bank and the ministers of the financial and economic bloc took place on August 16. Its participants demonstrated different views on the problem and conflicting proposals on how to solve it. However, in the end, it was decided not to make drastic movements, not to introduce mandatory sales of foreign exchange earnings for exporters and limit themselves to monitoring their behavior (which, in fact, Putin said in his speech). The President acknowledged that there are «many disputes» among officials about how to build economic policy under the current conditions. “But we have always found compromises, and we will find them now,” he promised.
As you know, a weak ruble allows you to quickly fill the budget, but it has a bad effect on inflation. The positive effect of the depreciation of the national currency, apparently, has already been obtained. Vladimir Putin said that the budget from the third quarter (i.e. starting from July, when the ruble began to fall rapidly) will be in surplus. And in general, for the year, the excess of expenses over income will be at the planned level — about 2% of GDP. Whereas earlier all the data indicated that it would be impossible to stay within the designated limits, and instead of 2.9 trillion rubles, the hole in the budget could grow to 5-6 trillion rubles. Tatyana Golikova said that the state of the federal and regional budgets allows for the required increase in the salaries of state employees. To this end, the payroll fund for employees of federal institutions will be increased by 30 billion rubles. And the local authorities will pay off the regional state employees at the expense of the non-target balances accumulated in them. “We will continue to index the minimum wage, social payments, benefits, pensions, and develop measures to support families and people with low incomes,” Putin promised.
As for inflation, everything here is not too rosy, but, according to the Kremlin, it is not too critical either. “Objective data show that inflationary risks are growing. And the task of curbing the rise in prices is now coming to the fore,» Putin stressed. Here he again turned to the functions of the Central Bank, noting that the regulator «should keep the situation under constant control and build economic policy accordingly.» In other words: if necessary, raise the rate again. This time, Putin did not voice any forecasts regarding annual inflation. But the Bank of Russia expects that price growth will go beyond the target values and by the end of December it may reach 6.5% instead of the previously promised 4%.
Unlike economic tasks, which, despite the limitations and difficulties, the authorities manage to more or less successfully solve, the task of “saving the people,” which Vladimir Putin called the “fundamental guideline,” does not lend itself to established approaches. Neither maternity capital, nor payments for children, nor the construction of kindergartens and nurseries, nor subsidized mortgages forced Russian women to give birth more. In the first half of 2023, the birth rate decreased by 2.3% compared to the same period last year. Officials link the low birth rate to the «demographic collapse of past decades,» but some are already beginning to suspect that this may be more than just that. Deputy Prime Minister Tatyana Golikova announced her intention to conduct a pilot project, the purpose of which is to find out what activities can really affect the reproductive behavior of Russian women. She hopes that the results of the «pilot» will allow to fine-tune the existing support measures and, perhaps, to develop new ones.
Vladimir Putin, for his part, said that the government should help the governors in the implementation of regional programs to increase the birth rate. “We need to additionally support families, expectant mothers, our traditional values. Unite the forces of the state, society, religious denominations and together achieve a turning point in the situation,” the President said.