Russia’s Prime Minister Dmitry Medvedev proposed last week that the country formulate budgets for only one year instead of the traditional three. Officially, the reason that the government feels unable to plan ahead for so long are the risks surrounding the oil price and rouble exchange rate fluctuations. But cabinet officials say the move was precipitated by the uncertainty over what happens when US rates rise.
Economy minister Alexei Ulyukayev has already become a laughing stock for adjusting the economic growth rate several times a year.
“But at least every time the rouble drops or soars again, at least we know what it means for the economy,” said one former senior official in Mr Ulyukayev’s ministry. “We can’t say that of the impact of US monetary policy. It could bring just a little bit more pressure on our currency and just a little bit more capital outflows, both of which wouldn’t be felt too strongly overall, or it could affect our financial stability.”