End of Fed stimulus will not affect Russia: minister

20th June 2013, Comments 0 comments

Russia's finance minister said on Thursday that the US Federal Reserve's expected tapering of its easy-money policy would not harm the Russian economy despite an expected fall in investment.

The Russian market has been underperforming badly in recent weeks along with those in other emerging economies because Western investors have begun withdrawing funds from higher risk regions.

Central Bank deputy chairman Alexei Ulyukayev said on Thursday that Russia's monthly net capital outflows had doubled in May from the April figure and reached nearly eight billion dollars (6.0 billion euros).

Much of the market jitters is the result of concern that the Federal Reserve intended to rein in the scale of its bond purchasing programme, which has stimulated the US economy, towards the end of the year.

The Federal Reserve's policy raised investor confidence and also added to the funds available for investment in higher risk activities, including in emerging markets.

But Finance Minister Anton Siluanov said that Russia "has no special risks."

Interfax quoted Siluanov as saying: "Investors are placing their money not in Russia, for the large part, but in other developing markets.

"There may be more problems there than in Russia," .

The finance chief was speaking on the sidelines of the Saint Petersburg International Economic Forum that President Vladimir Putin is hosting in his native city with an eye on improving Russia's investment outlook.

© 2013 AFP

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