Russian financial authorities fear devaluation of expenditures of the state and citizens. According to Finance Minister Anton Siluanov, to prevent this from happening it is necessary to return to a normal budget policy, as state spending may soon become useless and will not improve the living standards of citizens.
"If we continue with increased budget spending, what will we come to? Overheating. We can already see the elements of overheating - high inflation. Now it is about 5.9%, if we take it year by year, higher than our target (4%), it will lead to depreciation of expenditures, depreciation of money, social payments, wages. Is that what we want? No," Siluanov said at the St. Petersburg International Economic Forum.
"Obviously, both fiscal and monetary policies must come to their normal position. We understand very well that the further we drag it out, the harder it will be later to come out of the super-soft policy - both fiscal and monetary policy," he stressed.
St. Petersburg International Economic Forum is taking place on June 2-5. This year's topic is "Together Again. Economy of the New Reality". The event is organized by Roscongress Foundation.
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Author: Maria Buzanakova