Russia's Fiscal Tactics: Tapping Reserves Amidst Deficit Surge

The Russian government intends to use 447 billion roubles from its fiscal reserves to balance the 2025 budget after a significant deficit increase. Finance Minister Anton Siluanov confirmed no plans to boost reserves through oil revenue adjustments and no changes in borrowing plans for the year.

The Russian government is set to utilize 447 billion roubles, equating to $5.51 billion or 14% of its liquid fiscal reserves, to bridge the budget deficit expected to triple by 2025, according to Finance Minister Anton Siluanov's Tuesday announcement.

During a news conference, Siluanov clarified the government's stance on national borrowing, confirming that there are no intentions to adjust borrowing plans for the current year. He elucidated that replenishing reserves through reductions in the oil price 'cut-off,' a measure that typically redirects surplus oil revenues to reserves, will not occur in the upcoming three-year budget planning.

Siluanov emphasized that the upcoming budget cycle will not include a provision for a change in the 'cut-off' price. These strategies reflect Russia's efforts to manage its economy amidst fluctuating oil markets and significant budgetary challenges.

(With inputs from agencies.)