Mortgages in Berlin can be taken at 3% per annum, in New York – about 6%, and in Moscow – 10%. Often such a discrepancy is explained by the fact that inflation is high in Russia. Economists polled by Russian media believe that interest rates on loans in Russia are higher than in neighboring countries due to high economic risks. Is there a chance that money borrowed in Russia will become cheaper?
The Russian economy is not competitive in terms of interest rates on loans, Nikolai Kulbaka, associate professor at RANEPA and candidate in economics, said in an interview with Russian media. The main reason for this is that the Russian economy operates under a high level of risk.
“Imagine that a thousand people take out a mortgage at 5%. The figure is absolutely conditional. But a story, when everyone has quietly paid this 5%. Now imagine that 30% take out a mortgage and refuse to pay. With such risks, you will have higher mortgage interest rates in terms of people going bankrupt. Here is an example of logic.
In fact, the percentage is always based on the level of risk. And the level of risk in the Russian economy is now much higher than in any other economy in neighboring countries,” Kullbaka explained.
Even if we do not take into account the instability of citizens’ incomes, the budget deficit is increasing, expenses are increasing, various companies are gradually leaving Russia, and import substitution is not working as we would like, the expert noted. This is one of the reasons why the level of interest rates on loans and mortgages is much higher than the level of inflation, Kulbaka believes.
“In the context of the difficult process of adapting the economy to a new reality, such a level of rates really hampers the start of economic recovery,” said Andrey Stolyarov, associate professor in the department of financial market infrastructures at the Higher School of Economics. .
Alexander Shcherbak / TASS
Similar opinions are also expressed in Russian business circles. So, on June 9, billionaire Oleg Deripaska once again blasted with criticism at the Central Bank. This time the businessman’s attention was caught warnings regulator that the market is about to overheat and the prices of goods and services will begin to rise.
The billionaire doubted that one could speak of economic growth and import substitution in an environment where mortgages for the Russian population start at 10% (while for the Chinese – 4%). Deripaska urged to reduce tariffs, otherwise we will “suck our paw”.
What kind of overheating of the economy can we talk about with negative GDP rates is completely incomprehensible, said Andrey Stolyarov. Rather, the overheating economy is a good explanation for why the regulator continues to keep rates high, Kullbacka added.
“It is not certain that there will be overheating, but it is one of the arguments to explain why the rates are high. Not because we are afraid of inflation, but because we are afraid of the economy overheating. What’s the difference here: the overheating economy means things are going well for us. Yes, it’s hard, but it’s good. And inflation itself means that things are, in general, not going very well,” Kulbacka explained.
Indeed, there are enough factors contributing to inflation growth, says Sofya Glavina, Ph.D.
low unemployment rate (due to the migration of some Russians, there is a shortage of personnel in the labor market); high demand for goods (due to sanctions there are less goods, the market does not satisfy the demand); high production activity (high demand led to the fact that domestic production was launched to the maximum); weak ruble (the weaker the ruble, the more expensive the import).
This is what has many experts talking about a possible increase in the key interest rate at the next meeting.
“However, an increase in interest rates in the current environment comes up against a ‘very overheated’ Russian economy and can halt the adjustment process that has begun.
You cannot envy the central bank – it has to go between Scylla and Charybdis: the threat of inflation and the possibility of slowing down the process of economic recovery,” Stolyarov said.
Today, the Central Bank is pursuing a policy of raising the rate and limiting the rise in prices, Glavina reminded. According to her, the systematic weakening of the ruble suggests that inflation should pick up again. According to expert forecasts, the Central Bank may raise the rate in the near future to 7.75-8%. Then all rates in the country will rise: money will become more expensive – as a result, mortgage and business activity will decrease.
“It’s not that bad. Like in a joke – horror, but not horror-horror. That’s pretty much how it goes.
So far, companies are facing and most likely will continue to face this situation, but we don’t know how things will turn out, let’s say, not economic, but military-political. And everything else will depend on it.
Now, in fact, the Central Bank is creating a certain margin of safety in order to resist in the event of extreme situations,” summarized Kulbaka.
The Central Bank has mechanisms for solving the set tasks, Stolyarov believes. “With regard to the cost of loans, without waiting for a drop in market interest rates, it is necessary to develop a system of concessional loans for the realization of significant projects for the economy”, he advised . There is money in the banking system, you must learn how to convert it into credit activity.
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