The main thing in the new economic season

PublicPost asked economists whether we should expect a “second wave” of the crisis, what will happen to inflation, prices and exchange rates.

Irina Yasina, economist

— Should we wait for a crisis?

It seems to me that no special cataclysms await us, since the price of oil is still high, and oil, as we know, is our everything. There is hope that the situation will not change.

About growth rates

As for business activity, it is lower than it could be if the authorities did not put pressure on business. But since the authorities have been pressing for many years, the people have somehow gradually adapted to the pressure of the authorities. We have already become accustomed to the fact that growth rates are not as high as we would like. Well, as we rotted little by little, we will rot, and we don’t have to wait for anything.

About exchange rates

With currency everything will remain approximately the same. The rates will be quite stable.

About inflation

Prices for food and housing and communal services will gradually rise, as throughout the world. Food prices are rising due to a bad harvest. In Russia, prices would be lower, particularly in housing and communal services, if there was more competition and less theft. But under this government there will be no more competition and less theft. And even joining the WTO will not affect food prices in any way yet - simply because the WTO is a very long-lasting trump card in the deck. In principle, if we do not take the global price increase and simply exclude it, then prices from the development of competition for the consumer, on the contrary, will fall. Therefore, there is no need to be afraid of the WTO. If you are a manufacturer of a bad product, then be afraid, but if you are a consumer and want to buy what is better and what is cheaper, then you hold the cards.

Natalya Orlova, chief economist at Alfa Bank

— Should we wait for a crisis?

I do not expect any aggravation in the markets, although I believe that macro indicators may worsen. Especially inflation, which may be higher than expected.

About the budget

We are also not threatened by a budget deficit due to the upcoming indexation of expenses. In general, I have a feeling that the government has a desire to keep the budget under control. Another question is that a fairly restrained budget policy is accompanied by a very active expansion of the Central Bank, which is very actively lending to the banking sector. This means that the economy relies quite heavily on government resources. In this case, the resources of the Central Bank. Therefore, my concerns are not so much related to the destabilization of budget processes, but simply to the fact that the Central Bank may approach a limit beyond which it will be dangerous to increase its presence in the financing of the banking sector, and the banks will actually dry up the influx of new money.

About inflation

Inflation will, of course, affect the exchange rate, and ultimately we will see some slowdown in economic growth and final demand. What it will be like will become clear in September. If deflation appears in September, it will be very positive, but I consider this scenario unlikely. And if by the end of September we do not see zero inflation or deflation, then this, of course, will be a very clear signal that the Central Bank is not meeting its annual target of 6%, which will put the monetary authorities in a vulnerable position. After all, it is now very important to demonstrate the ability to control price dynamics so that the population stops closely monitoring the exchange rate and begins to look more closely at the dynamics of domestic prices. If inflation becomes a priority for the Central Bank, this will prevent the flight of deposits into foreign currency or simply the conversion of income into foreign currency in the event of some instability. The world situation is very fluid. We see that oil prices behave very unpredictably and change quickly. And here it is important that the population is not tempted to play on such exchange rate fluctuations, because this can be fraught with large losses.

About exchange rates

I believe that there will be no negative surprises in Europe in the near future. It seems to me that a dialogue is now being established there quite constructively between creditor countries and borrower countries. Of course, there will be no economic growth there. The dollar-euro pair will probably be 1.30, but this is due to the fact that the volume of emissions, the increase in support from the ECB (European Central Bank - PublicPost) is not as significant as initially expected, but the Fed (Federal Reserve System, the equivalent of the Central Bank in USA - PublicPost) will announce quantitative easing. Therefore, from the point of view of the dynamics of the money supply, the balance will still be in favor of the euro.

Evgeny Konovalov, economist

— Should we wait for a crisis?

Most likely, there will be no new wave of crisis this fall. Because we seem to have overcome the critical point. If something usually starts, it starts at the end of August, and in September-October it peaks.

About growth rates

In the previous half of the year, industry growth was 30% (I provide unofficial data collected by marketing agencies). This year it is 6%, which is almost comparable to inflation. This means that we are now not developing the very potential that allowed us to grow and maintain the ruble exchange rate.

About the budget

Perhaps the budget will be in deficit, perhaps the deficit will not be too large. But the budget will most likely be affected by serious spending in the winter, and we will feel it in the fall.

About exchange rates

The exchange rates of the dollar and euro will rise against the ruble. In October, the dollar exchange rate can reach 33-34 rubles, the euro exchange rate - somewhere up to 42 rubles. The dollar will slowly, very smoothly strengthen against the euro, since the US economy has now more or less stabilized, although in some places unemployment is rising, and in others it is compensated by a slight increase in production.

The bad situation in Greece, Spain, Italy and a number of other countries, including those outside the Eurozone, will in any case affect the euro, and it will fall slightly.

About inflation

The price increase was delayed by the government, which is why we are now seeing price hikes. Oil prices have risen again from $90 to $100 per barrel, so we can expect an increase in fuel prices, and this, in turn, will lead to prices for other products.

On the other hand, if fuel prices remain stable, and this is possible given the Middle Eastern conflicts, then this will be a guarantee that Russia will not repeat the Belarusian scenario, when before the elections they raised public sector salaries and pensions - and ended up with a budget deficit. One way or another, Russia has a cushion in the form of high oil prices, which will allow it to overcome the budget deficit. Of course, the colossal and worsening dependence on resources may eventually lead to the fact that as soon as oil prices go down, we will immediately be in big trouble. Well, they will go down as soon as the economy of the European Union, which is our main consumer, goes down.