Russian capital flight decelerates dramatically – central bank

The trend has been attributed to strong economic recovery

The outflow of capital from Russia decreased more than sixfold in 2023 when compared to the previous year, according to the head of the country’s central bank, Elvira Nabiullina.


She told the State Duma on Thursday that the Russian economy had recovered from the sanctions-induced crisis much faster than all the forecasts and continues to grow. According to Nabiullina, output, consumption, and investment in fixed capital have all rebounded, which shows that the weakening ruble and inflation cannot be blamed on capital outflow. She clarified that the depreciation of the Russian currency, which started in the middle of the year, was the result of changes in the balance of trade.

‘We had to act decisively to prevent an inflationary spiral from unwinding, so as not to undermine the growth of real incomes of the population … By raising the rate to 15% in October, we also took into account the new parameters of fiscal policy. They suggest a more expansionary fiscal policy,’ the head of the regulator stated.

The Bank of Russia’s basic scenario assumes that, in 2024, inflation will return to the targeted 4%, subsequently paving the way for the gradual reduction of the key interest rate.

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