Russians have lost faith in ruble
The Russian Central Bank published the results of a poll conducted by the inFOM company, according to which only 13% of Russians expect that the ruble will strengthen against the dollar within a year - a similar level of pessimism has been reached only in December 2015 and September 2014.
32% expect that there will not be any significant changes in rates of the ruble and the dollar during the year. 30% predict a decline in the ruble exchange rate and the growth of the dollar.
The number of people confident in the US currency has doubled in a year: according to the same study by the inFOM company in April 2015, only 15% of respondents expected the growth of the dollar and 29% of respondents believed in the stretchering of the ruble.
At the same time, 72% of respondents continue to keep money in rubles, RBC reports.
Professor of the RANEPA faculty of Finance, Money Circulation and Credit, Yuri Yudenkov, speaking to a correspondent of Vestnik Kavkaza, noted that the survey results are consistent with expectations of experts. "Most people expect that after the elections to the State Duma the ruble will go down for many reasons. Our currency was stable in relation to the dollar and the euro as a whole during the two last quarters, which is not typical in the absence of the economic growth. The low price of oil, gas, coal and problems with growth in other sectors should be compensated to implement budget plans, and it is likely that the Central Bank and the Ministry of Finance will achieve this through the depreciation of the ruble," he explained.
The expert added that at the same time, the unwillingness of the population to move into dollars is quite clear. "Firstly, if your savings are less than 100 thousand rubles, it does not make sense to keep it into a foreign currency. Without significant contributions, you need to have an airbag in the native currency. If you have large sums of money, then of course, you should divide them into three parts and keep equally in rubles, euros and dollars - but there is an impoverishment of the population is in the country now," Yuri Yudenkov pointed out.
The economist expressed confidence that in the future the ruble will strengthen after the autumn-winter decline. "For a number of reasons the economy would improve. Our high technology began to develop, as well as machinery. Also we should not forget about the US factors: a bubble in the US securities is huge one again and everyone is waiting for it to burst. Therefore, there is a risk that the dollar rate may decline," the Professor of the RANEPA faculty of Finance, Money Circulation and Credit concluded.
An associate professor of Stock Markets and Financial Engineering of RANEPA, Vasiliy Yakimkin, in turn, listed several reasons for the negative expectations of Russians. "Firstly, people lost faith in the rapid rise in oil prices, as the US open new wells every week. Secondly, the technology of oil production is improving and its cost is decreasing. Thirdly, OPEC tries to announce that it controls everything, but it has real leverages," the expert named the first cause.
"Another reason is that, perhaps, the Bank of Russia will begin to reduce the cycle of the key rate and the Federal Reserve, on the other hand, is ready to increase it, these two events will give a multiplier effect and the ruble will fall dramatically. Another thing is that the government is worsening the economic outlook, the GDP decline in 2016 is expected to reach 0.6%. Therefore, even if there are objective reasons for the strengthening of the ruble, its growth would still be constrained by domestic financial top managers," Vasily Yakimkin believes.
With regard to keeping of savings in rubles, then there are a number of facts making investments in dollars unprofitable. "Firstly, banks have sharply reduced the interest rates on foreign currency deposits. Secondly, there are rumors that the circulation of the dollar in the country may be banned and foreign currency accounts will be frozen. The third reason relates to the fact that banks' customer base, which would open new foreign currency deposits is not growing," he said.