16:24 GMT +323 February 2019
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    MOSCOW, July 15 (RIA Novosti) - Central Bank chief Sergei Ignatyev said on Thursday that the Bank did not intend to revise its inflation and rouble growth forecasts.

    "We will not thus far revise our forecasts," Mr Ignatyev said and reminded that inflation would not exceed 10% at the year's end, while the rouble would grow no more than 7%. "This is quite a realistic forecast," said Mr Ignatyev.

    Mr Ignatyev believes the situation in the banking sector has largely returned to normal. "Moscow alone was in fever. However, starting from Monday, individuals stopped withdrawing their bank deposits on such a massive scale," said Mr Ignatyev.

    "I have talked to the executives of some bank. They said the money outflow had halted," said the Central Bank chief.

    Mr Ignatyev said the Central Bank had returned close on 50 billion roubles ($1 dollar equals around 29 roubles) from the compulsory reserve fund in Moscow alone.

    "The compulsory reserve fund has decreased twofold and the parliament adopted a law on bank deposit insurance, which helped stabilise the situation," said Mr Ignatyev.

    "The confidence crisis has ended," he noted.

    Mr Ignatyev believes a decrease in reserve fund deductions will not cause inflation growth. "This will not result in the growth of money stock and inflation," said the Central Bank chief.

    Last week, the Central Bank reduced reserve fund deduction rate for banks from 7% to 3.5% in an effort to bring normality to the banking sector.

    Mr Ignatyev said the inter-bank crediting market had shrunk considerably of late. Therefore banks' liquidity requirements have risen. "By cutting compulsory reserve fund rate we only met the increased demand," said Mr Ignatyev.

    Money supply hiked 52% in 2003, while inflation dropped to 12% compared to 15% in 2002. Mr Ignatyev explained that by a dramatic demand for money in 2003. "Today the situation is similar," Mr Ignatyev said and added that the Central Bank did not intend not raise compulsory reserve rates in the future.

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