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Finance and Credit
 

Economic boundaries of the Bank of Russia's operations

Vol. 27, Iss. 5, MAY 2021

Received: 28 January 2021

Received in revised form: 11 February 2021

Accepted: 25 February 2021

Available online: 28 May 2021

Subject Heading: Financial system

JEL Classification: Е50, Е58, Е59, G21, G24

Pages: 1093–1115

https://doi.org/10.24891/fc.27.5.1093

Valerii V. SMIRNOV I.N. Ulianov Chuvash State University (ChuvSU), Cheboksary, Chuvash Republic, Russian Federation
v2v3s4@mail.ru

https://orcid.org/0000-0002-6198-3157

Subject. The article focuses on operations of the Central Bank’s of the Russian Federation.
Objectives. The study is to determine economic boundaries of operations of the Central Bank of the Russian Federation.
Methods. The study is based on the systems approach and methods of statistical, neural network and cluster analysis.
Results. Analyzing the tomorrow-today dynamics of difference of the weighted average exchange rate RUB/USD and EUB/EUR and supply of USD and EUR, I discovered the supply of USD steadily exceeded the supply of RUB/EUR starting from 2018. Analyzing trends in growth rates of international reserves and money base (in its narrow sense), I found a growth in monetary growth starting from 2015 and currency reserves, cash in circulation (out of the Bank of Russia), statutory reserves of credit institutions in the Bank of Russia starting from 2017. Analyzing the importance of growth rates of market indicators, I identified its effective configuration referring to the dynamics of SP500. However, I point out stocks of Rostelecom, gold and RUB/USD. The article demonstrates the important ties between RTS index and stocks of Gazprom and Rostelecom, USD index ? RUB/USD, gold, SP500. Considering the existing structure of the Russian economy, the upper and base boundaries of the Bank of Russia’s operations are Repo rate and RUB/USD respectively.
Conclusions and Relevance. The above economic boundaries of the Bank of Russia’s operations allow financial institutions to pursue an increase in the sustainability of the banking system, preserve the ownership structure, legal form and corporate governance, and use derivatives in order to decrease borrowings costs. The study contributes to the knowledge and competence of governmental officials so as to make administrative decisions on sources of growth in the Russian economy and respective opportunities.

Keywords: exchange rate, activity, transaction, growth rate, Bank of Russia, economic boundaries

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