Reuters / WASHINGTON (Reuters) – Russia’s central bank made the right decision to defend the ruble in the short term and prevent excessive volatility in the exchange rate when the Ukraine crisis escalated, a senior official at the World Bank said on Wednesday.
The Russian Central Bank was forced in early March to halt its shift towards inflation targeting and instead tame the ruble’s fall after Russia seized and annexed Ukraine’s Crimea. Since then, the bank has spent nearly $30 billion in currency interventions.
“That was not a bad strategy to try to overcome that period instead of creating a lot of volatility in the currency,” said Hans Timmer, World Bank chief economist for Europe and Central Asia.
“I would argue that the central bank should do that, look at these other variables (currency rates, asset prices) in the short run,” Timmer said on the sidelines of the International Monetary Fund and World Bank meeting. “But ultimately it is their responsibility to keep inflation under control.”
Con Información de Reuters