Russia is not pursuing a sufficiently tight fiscal policy at a time when its oil-driven economy is growing rapidly, a top International Monetary Fund (IMF) official said today.
"The Russian economy probably cannot grow much more rapidly," Ms Anne Krueger, first deputy managing director of the IMF, told a conference attended by economists and financial officials from the ex-Soviet states.
"There is no point in much more fiscal stimulus at this time," she said. Ms Krueger said fiscal laxity was putting an excessive burden on the central bank, forcing it to pursue a tight money policy.
"If I look at the overall behaviour of the central bank, monetary policy has too much to do because fiscal policy is not doing enough. At the same time the central bank is looking at the exchange rate more than it should," she said.
Ms Krueger said that if it were not for record high oil prices, which have boosted fiscal revenues in the world's second-largest crude exporter, Russia would have expanded its fiscal deficit over the past few years.
"We at the IMF look at what the fiscal balance would be with an average price of oil. On that basis over the last two years fiscal policy has increased the amount of deficit it would have had at a normal price of oil".
"So monetary policy is burdened by maintaining price stability and offsetting some of the fiscal stimulus".
Russia posted a 351.8 billion rouble ($12.04 billion) budget surplus in the first eight months of this year, equivalent to 3.4 per cent of gross domestic product, according to preliminary figures.