Bank of Russia starts crisis briefings as nation shuts down

Bank of Russia Governor Elvira Nabiullina will start holding news briefings every Friday to clarify policy changes as the economy gets battered from a nationwide shutdown and the collapse in oil prices.

The first meeting will be held online at 3 p.m. Moscow time on Friday, April 3, and Nabiullina will discuss past and planned measures, according to a statement on the central bank’s website.

“Communication is key at the moment,” said Dmitry Dolgin, ING Bank’s chief Russia economist. “Given the heavy news flow, regular commentary from the governor can keep the markets focused on the key messages and lower the risk of harmful rumours.”

Tougher social isolation measures announced Sunday mean the central bank of the world’s biggest energy exporter now has to grapple with an economic slump as well as an oil price crash. Just weeks ago oil prices below US$25 a barrel and a total lockdown were considered a worst-case scenario by Russian policy-makers.

The announcement follows an unscheduled briefing that was added to the central bank’s interest-rate decision last month.

Nabiullina usually only holds four news briefings a year following every other rates meeting.

A nationwide lockdown could cause Russia’s economy to shrink by five per cent to 10 per cent this year, according to forecasts being discussed by the government last month.

Unlike many other countries, the Russian government has so far been cautious with fiscal stimulus as it waits to see how low oil prices could fall.

The central bank started selling foreign currency last month to mitigate the ruble’s more than 20-per-cent slump against the U.S. dollar this year. Russia’s international reserves plunged 5.1 per cent to US$551.2 billion in the week through March 20, but are still among the biggest in the world.