Russian Central Bank Governor Elvira Nabiullina said that the Russian Central Bank will return to buying foreign currencies if oil prices rise to $88-90 per barrel, according to Russian media.
She added that the bank will continue selling foreign currencies in January, and the volume of sales will be announced soon.
The Russian Central Bank had stopped purchasing foreign currencies until the end of the current year, last August, to avoid exacerbating pressure on the ruble, whose value declined significantly in August and September, as the exchange rate exceeded the 100 ruble barrier against the US dollar.
But the ruble has since seen a recovery, with the exchange rate stabilizing at around 92 rubles to the dollar on Monday.
Nabiullina told RBC: The question of whether we are a net seller (of foreign currencies) or a net buyer depends largely on the price of oil.
The settlement price for Brent crude futures was set at $79.07 per barrel on Friday.
Mandatory foreign exchange sales in Russia
Last October, Russian President Vladimir Putin issued an order requiring 43 groups of exporters to repatriate 80 percent of foreign currency earnings, and then sell 90 percent of that amount with the aim of stabilizing the ruble.
This decision came in light of the decline in the value of the ruble to its lowest levels in more than 18 months against the dollar, the third worst performing currency in emerging markets this year. The Russian currency has been under pressure due to capital outflows and reduced foreign currency supplies.
The Mandatory Foreign Exchange Sales Decree applies until March 2024.
Nabiullina said that the measure should be temporary and that the bank does not expect sharp changes in the forex market when it expires.
She also said the Russian central bank would need two to three months to ensure that inflation is falling steadily before making any decision on cutting interest rates.
