Joint Eurosystem – Bank of Russia seminar

The Eurosystem – i.e. the European Central Bank and the national central banks of the euro area – and the Bank of Russia are holding their second joint seminar, which takes place from 12 to 14 October in Saint Petersburg. The Seminar, hosted by the Bank of Russia, is being attended by governors and high-level representatives of the ECB, the Bank of Russia and the 12 national central banks of the euro area. Seminar participants also include representatives of the Executive Office of the President of the Russian Federation, Federal Assembly and the Government of the Russian Federation as well as representatives of the European Commission.

ECB President Jean-Claude Trichet stressed the importance of the seminar as a means for strengthening the dialogue between the Eurosystem and the Bank of Russia. Russia is a strategic partner for the EU and over recent years cooperation between the central banks of the euro area and Russia has expanded against the background of the evolving links between the parties in the monetary and financial field.

In his keynote speech, Bank of Russia Chairman Sergey M. Ignatiev gave an overview of challenges to Russian monetary and exchange rate policies. He emphasized that the main goal of the Bank of Russia in short and medium term is to reduce inflation gradually and maintain it at a low level. When elaborating and implementing its monetary policy, the Bank of Russia uses some elements of inflation targeting. In future it plans to achieve inflation targets mainly by means of the interest rate policy.

In panel discussions seminar participants focused on banking sector stability and development issues. There was agreement that banking sector stability, i.e. its ability to withstand shocks, is of key importance to promote banking sector development. Participants exchanged views on challenges for banking sector stability arising, among other, from rapid growth of bank lending as well as the expansion of cross-border borrowing. They reviewed banking sector policies, including recent introduction of a deposit insurance system in Russia, also reflecting on the experience gained in the euro area.

The seminar demonstrated the benefits of a policy dialogue between the Eurosystem and the Bank of Russia. Participants have agreed to continue cooperation, including organisation of similar gatherings on a regular basis, thereby complementing the bilateral relations between several national central banks of the euro area and the Bank of Russia.