Sberbank head expects ruble to weaken to 85-90 rubles/$1 by year's end

VLADIVOSTOK. Sept 5 (Interfax) - Sberbank head Herman Gref expects the ruble to weaken to 85-90 rubles against the U.S. dollar by the end of this year.

"In my view, the ruble is overvalued right now and one should not expect the ruble to strengthen. It's difficult to predict anything, because this is a multi-factor matter, but what we're seeing today, the easing of policy that's happening now, will lead to the weakening of the ruble. We believe that we should see 85-90 [rubles/$1] by the end of the year," Gref said in an interview with Nailya Asker-Zade on the Vesti program on TV channel Rossiya 1.

"In the next three years, of course, it's very difficult to predict but, again, given the normalization of geopolitics, at this point I don't see anything that could lead to a significant strengthening of the ruble. And it's also clear that consumer imports are very much stagnating, meaning a savings model of behavior, people aren't spending, people are saving. All this leads to a decrease in demand for imports and there's not as much pressure on the ruble's exchange rate," Gref said.

"In the next three years the situation could change dramatically if there is a change in geopolitics, of course, the lifting of sanctions, say, a turnaround in consumer behavior. This could very significantly weaken the ruble, which, in general, will give a big push to the economy," he added.

Economic Development Minister Maxim Reshetnikov said on Thursday that the ruble exchange rate in his ministry's updated macroeconomic forecast will be stronger than in previous projections.

"And, unfortunately, we'll all have to adapt to this. This is a fairly serious challenge for the economy," Reshetnikov said.

The Central Bank of Russia's official exchange rate for the dollar for September 5 is 81.2977 rubles.