During the second quarter of the year Russia’s Federal Treasury may start to convert part of funds from the Reserve Fund to finance the budget deficit in 2016, according to the Central Bank’s commentary released on Thursday.
“The probability is high that in the second quarter of 2016, including already in April, the Federal Treasury will begin the conversion of the Reserve Fund to finance the budget deficit in 2016. This will lead to an inflow of liquidity into the banking sector and reduce its debt on refinancing operations of the Central Bank,” the regulator said.
Earlier on Thursday, Vladimir Kolychev, head of the Finance Ministry’s long-term strategic planning, said that Russia’s Finance Ministry will start to spend money from the Reserve Fund in the first half of the year. The spending will depend on the amount of funds on the account of the Federal Treasury, he added.