Economy minister opposes "excessively aggressive targets" for inflation targeting
SOCHI. Sept 19 (Interfax) - Russia's Central Bank should abandon "excessively aggressive targets" for inflation targeting because this is depressing economic activity, Economic Development Minister Alexei Ulyukayev believes.
"It's necessary to slightly forego excessively aggressive targets for inflation targeting," Ulyukayev said at Sberbank's business breakfast "Balanced Budget for Accelerated Growth: Time to Choose?" at the Sochi-2014 investment forum.
"I also carry my part of responsibility for inflation targeting, because I developed this issue at the beginning. But one should remember that excessive aggressiveness here puts the Central Bank in a completely intolerable situation, where it is supposed to reach targets that it can't reach, along the way excessively depressing economic activity," Ulyukayev said.
He said that "if right now the inflationary backdrop is being created in large part due to the sanctions regime and anti-sanctions regime, for example the imposition of the embargo on food and so on, plus due to the strong effect of carryover, when the national currency is weakening for reasons in no way related to the trade balance, but related to capital outflow, which in turn is due to the geopolitical situation, this means that we get a major gap between fairly aggressive and ambitious targets for inflation that we have set and actual macroeconomics."
"I believe that in this case we should adjust the targets, abandon excessive aggressiveness on targets that do not correspond to the changing reality," Ulyukayev said.