On the Bank of Russia FX policy (Unofficial translation)

Effective from 10 December 2013 the Bank of Russia cut the cumulative volume of FX interventions, which lead to the shift of the operational band’s boundaries by 5 kopecks, from 400 to 350 mln US dollars. This adjustment was made to ensure further increase of the rouble exchange rate flexibility in the context of the ongoing transition towards the floating exchange rate by 2015.

The decreased cumulative volume of FX interventions would lead to higher sensitivity of the operational band boundaries to the amount of FX interventions aimed at smoothing the excess volatility of the rouble exchange rate. Ceteris paribus, the implemented modification would reduce the scale of the Bank of Russia presence on the FX market, which would enhance the effectiveness of interest rate policy.

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