Brexit, Another Worry for Russian Pensioners

Russian independent TV station Rain TV considers the possible impacts of Brexit on Russian pensions.  According to Deputy Finance Minister Ayrat Farrakhov, the primary concern for the Russian pension fund managers is the ensuing volatility on the financial markets.  However, the Russian Central Bank doesn’t think that Brexit represents a direct threat to the Russian economy, while “United Russia” party officials stated that they won’t insist on pegging the pensions to the actual inflation this year, which certainly makes the problem of the pension fund deficit more manageable.
Professor of finances at the Russian Economic School Oleg Shibanov stated that Brexit already negatively affected the oil market, but that he doesn’t expect the oil price to fall by more than three dollars per barrel. He believes that the Government might use external volatility to justify internal economic problems, as the central government budget is well underway to breach the planned deficit of 3% of BDP.  Professor Shibanov believes that the markets will continue to fall, but other circumstances will prove to be just as important as Brexit – for example, changes to the FED rate.  He advises against moving personal savings from one currency to another in times of volatility, as ordinary investors will hardly be able to guess the direction in which the exchange rates will move.  

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