by Edward Hugh: Barcelonabr /br /br /The Russian ruble strengthened the most in more than three months against the dollar yesterday (gaining 1.7 percent to 32.2247 per dollar at one point) as oil rebounded above $60 a barrel and OAO Sberbank reported better-than-expected earnings. Sberbank shares jumped 5.1 percent after first-quarter net income turned out to be above analyst estimates. But the rise was also helped by the fact that Russia’s central bank spent approximately $2 billion from reserves to try to stop the ruble from falling yesterday, taking central bank reserve spending over the two working days since they lowered interest rates half a percantage point on Friday to around $4 billion, a href="http://www.bloomberg.com/apps/news?pid=newsarchiveamp;sid=aTqgrOY1vdEo"according to reports in the newspaper Kommersant/a.br /br /Russia’s central bank cut its main interest rates for the fourth time in less than three months at the end of last week after the government estimated the ...

Russian industrial production dropped sharply again in December – by the most since at least 2003. Output was down 10.3 percent following an 8.7 percent fall in November, according to data from the Federal Statistics Service announced yesterday (Thursday) by central Bank Chairman Sergey Ignatiev. Output growth for the year was 2.1 percent, the slowest since at least 1999. br /br /a href=”http://4.bp.blogspot.com/_ngczZkrw340/SXnHod1_lII/AAAAAAAAMVY/OmOY6oKT5Zk/s1600-h/russia+manufacturing.png”img style=”display:block; margin:0px auto 10px; text-align:center;cursor:pointer; cursor:hand;width: 400px; height: 237px;” src=”http://4.bp.blogspot.com/_ngczZkrw340/SXnHod1_lII/AAAAAAAAMVY/OmOY6oKT5Zk/s400/russia+manufacturing.png” border=”0″ alt=”"id=”BLOGGER_PHOTO_ID_5294482334970516610″ //abr /br /Manufacturing fell an annual 13.2 percent in December, compared with a decline of 10.3 percent in November, as steel-pipe production dropped an annual 35.3 percent and coking coal output plunged 44.2 percent. Truck production plummeted 67.1 percent. br /br /This data is not surprising, and only confirms what we have been seeing in the VTB PMI. The next interesting data appointment will be on 2 February, when we should get to see what …

Russian industrial production dropped sharply again in December – by the most since at least 2003. Output was down 10.3 percent following an 8.7 percent fall in November, according to data from the Federal Statistics Service announced yesterday (Thursday) by central Bank Chairman Sergey Ignatiev. Output growth for the year was 2.1 percent, the slowest since at least 1999. br /br /a href=”http://4.bp.blogspot.com/_ngczZkrw340/SXnHod1_lII/AAAAAAAAMVY/OmOY6oKT5Zk/s1600-h/russia+manufacturing.png”img style=”display:block; margin:0px auto 10px; text-align:center;cursor:pointer; cursor:hand;width: 400px; height: 237px;” src=”http://4.bp.blogspot.com/_ngczZkrw340/SXnHod1_lII/AAAAAAAAMVY/OmOY6oKT5Zk/s400/russia+manufacturing.png” border=”0″ alt=”"id=”BLOGGER_PHOTO_ID_5294482334970516610″ //abr /br /Manufacturing fell an annual 13.2 percent in December, compared with a decline of 10.3 percent in November, as steel-pipe production dropped an annual 35.3 percent and coking coal output plunged 44.2 percent. Truck production plummeted 67.1 percent. br /br /This data is not surprising, and only confirms what we have been seeing in the VTB PMI. The next interesting data appointment will be on 2 February, when we should get to see what …

strongThe Ruble Devaluation Continues/strongbr /br /The ruble fell the most in nine years against the euro this week after the central bank widened its trading band twice and allowed the currency to fall by a further 3.8 percent, following last week's 1 percent devaluation. The currency retreated to a maximum of 5.8 percent over the week, although it recovered somewhat and was up 0.1 percent again today (Friday) over yesterday, trading at 39.1772 per euro at midday in Moscow. The currency has now fallen 16 percent against the dollar since the start of August, and added another 1.3 percent to its losses today, hitting 27.8412 per dollar and falling 1.1 percent (to 33.1020) against the currency basket which is targeted. The ruble thus lost 3.9 percent to the basket this week, in the process experiencing its sixth weekly drop.br /br /br /strongForeign Exchange Reserves Continue To Decline/strongbr /br /br /Russia’s ...

By Edward Hugh: Barcelonabr /br /Russia's foreign-exchange reserves have been now been declining very rapidly since mid August, and as the money goes so does the faith that the large stock of reserves the country built up during the boom times would be sufficient to see them through any downturn in energy prices. As the money leaves, so it seems does the decade of economic growth and stability which they symbolised. Indeed so rapid has been the decline that Russia's international reserves, which are the third-biggest after those of China and Japan, have now fallen $161 billion, or 27% percent, since 8 August last, and decreased by $17.9 billion to $437 billion in the week to 5 December. Investors have now pulled $211 billion out of the country since August, according to estimates by BNP Paribas.br /br /br /pa href="http://1.bp.blogspot.com/_ngczZkrw340/SUbQptNe4tI/AAAAAAAALyE/K0xlBOy3AlA/s1600-h/russia+GDP.png"img id="BLOGGER_PHOTO_ID_5280137028067844818" style="DISPLAY: block; MARGIN: 0px auto 10px; WIDTH: 320px; CURSOR: ...

Russia's currency reserves, the third-biggest in the world, are falling steadily as tumbling oil prices and an exodus of capital are piling the pressure on the central bank and government policymakers to accept a devaluation in the ruble. Oil prices which are now down 60% from their july peak, slowing economic growth and increasing investor concern are steadily draining Russia's foreign exchange reserves, which fell 19 percent (to $484.6 billion) in the 12 weeks through Oct. 31. This is down from $598.1 billion in the week before the invasion of Southern Ossetia.Russia had been using the reserves to try and contain the upward movement in the ruble was thought to present a threat to the competitiveness of exports. But resistance is now becoming increasingly difficult in the fact of a 13 percent drop against the dollar since August 1.Bank Rossii began managing the ruble's exchange rate ...

Russia's President Dmitry Medvedev today pledged $20 billion in financial support for the Russian stock market and cut oil taxes in an attempt to bring a halt to what has now become Russia's worst financial crisis in a decade. Medvedev took this action in order to try to lay the basis for a reopening of Russia's bourses tomorrow, following three days of irregular operation on the back of a 25% drop in the Micex Index. Following the announcement Russian shares traded in London surged and the interbank lending rate plunged.The announcement followed a meeting between Medvedev, the central bank Chairman Sergey Ignatiev and Russia's Finance Minister Alexei Kudrin. Ignatiev also announced that central bank reserve requirements for Russia's banks would be eased in an attempt to provide more liquidity.The tax cut for oil exports will come into effect on Oct. 1 and save producers and refiners ...

Russian inflation accelerated in August and remained close to its fastest pace in more than five years as food costs continued to rise. The Russian inflation rate rose to 15 percent from 14.7 percent in July, according to data from the Moscow-based Federal Statistics Service earlier today. Month on month, prices were up 0.4 percent, after rising 0.5 percent in July.The central bank forecast slowing monthly price growth or a possible decline in August. Monthly inflation increased ``unexpectedly'' on meat and dairy costs, Alexei Ulyukayev, the central bank's first deputy chairman said in response. Food prices increased an annual 22 percent in August, including a 45 percent gain in pasta and a 33 percent rise in dairy costs.

Russian industrial output growth continued to show signs of weakness in July after expanding at the slowest pace in five and a half years in June. Industrial output increased at a 3.2 percent annual rate compared with 0.9 percent increase in June, according to data from the Federal Statistics Service earlier today. The June result was the slowest rate of growth since the service began calculating data under new methodology in 2003. Month on month output was up 3.3 percent from June. Manufacturing increased an annual 4.6 percent in July, compared with 0.6 percent the previous month. Cement production dropped 8.2 percent. Mining and quarrying fell 1.8 percent, compared with growth of 0.6 percent in the previous month. Crude oil and gas condensate production fell 1.9 percent compared with a year ago. Electricity, gas and water output increased an annual 5 ...

by Edward Hugh: BarcelonaRussia's inflation rate remained tantalisingly frozen at its highest in more than five years in June as energy and food prices continued to move on upwards. Russian consumer prices were up 15.1 percent from a year ago - matching the rate in May- according to data released earlier this week by the Federal Statistics Service.As a result he Russian government is struggling to bring inflation down towards it's 10.5 percent target after increased income from rising global energy prices boosted domestic demand and made possible 300 billion rubles ($13 billion) of extra government spending on items like pensions and state wages in the run up to last December's elections. The result has been a massive surge in consumer spending and construction activity which has pushed the rate of expansion in the Russian economy above its long ...