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    CENTRAL BANK CHIEF ON DECREASING GOLD AND CURRENCY RESERVES

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    MOSCOW, April 9 (RIA Novosti) - Chairman of Russia's Central Bank Sergei Ignatyev has assured Russian President Vladimir Putin that the slight decrease in Russia's gold and currency reserves in the past few weeks is a normal and natural process.

    "Considering our enormous gold and currency reserves, these problems are being addressed, and these processes pose no danger," Mr. Ignatyev said during his working meeting with the president on Friday.

    As of January 1, 2004 Russia's gold and currency reserves amounted to $77 billion; as of February 20 - $89 billion; as of April 5 - $83.8 billion.

    Mr. Ignatyev put this reduction down to two reasons. "Firstly, the finance ministry effected big payments - $4 billion - on Russia's foreign debt in late February and in March," he added.

    Moreover, the chief of the Central Bank noted that in the past 1-1.5 years the short-term capital flow had become more dynamic and changeable. "In other words, the periods of short-term capital inflow through the country's banking system were followed by the periods of short-term capital outflow," he said.

    "This is a natural, normal process, and there is nothing surprising or dangerous for us in it," he said.

    According to Mr. Ignatyev, the rate of inflation will make 8-10% this year. "On the whole, the macroeconomic situation is within the norm," Mr. Ignatyev said to the president.

    In his words, during the three months of this year, the rate of inflation has decreased.

    "The growth of consumer prices in the first three months of this year made 3.5%," said the chief of the Central Bank, adding that last year this figure was 5.2%.

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