Gerashchenko: Ruble outlook 'favorable'

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ST. PETERSBURG – Russian foreign exchange market prospects are favorable as the Central Bank has accumulated sufficient reserves to support the ruble, Central Bank (CBR) Chairman Viktor Gerashchenko said.

"We can assess the outlook for the foreign exchange market as favorable," Gerashchenko told a banking congress. "The Bank of Russia has saved enough capital to fend off speculative attacks on the national currency."

The CBR said earlier Thursday that its gold and foreign exchange reserves had risen $800 million to $19.9 billion in the week ending June 2.

The ruble has been firming steadily since the start of the year, supported by strong export revenues resulting from high international energy and commodity prices.

Gerashchenko said export revenues in the near future would not be lower than in April.

Prime Minister Mikhail Kasyanov said last month that further strengthening of the ruble was not in the economy's best interests.

But Gerashchenko reiterated his view that artificial weakening of the ruble rate against the dollar would not be good for Russia.

"The negative consequences of the national currency's depreciation may be harmful for the social sector, households ... and servicing foreign debt," he said.