Nabiullina Says Russian Economic Growth Rate Is Below Potential

Bank Rossii should use monetary and credit policy to help the economy grow without undermining core goals of keeping inflation low and the financial system stable, Elvira Nabiullina, bank’s next chief.

Nabiullina, President Vladimir Putin’s economic aide who was backed by lawmakers this month to become the first woman in June to head a Group of Eight monetary authority, said the current growth rate is “below potential.”

“In my view, the central bank should consider trends of the economic growth. This what any central bank does,” Nabiullina told reporters late yesterday. “I am opposed to heating up the economic growth by acceleration of inflation.”

The first change of leadership in more than a decade at the Russian central bank, which controls the world’s fourth-largest reserves, comes as the country’s $2 trillion economy is growing at the weakest pace since a 2009 contraction. Russia risks sliding into a recession without stimulus, according to Economy Minister Andrei Belousov.

Putin has urged the government to come up with a plan to revive the flagging economy as he maintains that combating inflation and boosting wages are top priorities. His medium-term economic growth target is 5 percent.

To contact the reporters on this story: Ilya Arkhipov in Moscow at iarkhipov@bloomberg.net; Evgenia Pismennaya in Moscow at epismennaya@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net

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