Kasyanov outlines priorities in Cabinet monetary policies for 2003

The main goal of the Russian monetary policies for the next year will be areduction in inflation to 9 percent or a maximum of 12 percent, RussianPrime Minister Mikhail Kasyanov announced at the opening of a Cabinetmeeting today. The meeting was devoted to the main parameters of the singlestate monetary policies for 2003. Kasyanov stressed that a reduction in theinflation rate should be set as a priority. The Prime Minister admittedthat this goal had not been always achieved over the past years but thisyear they hoped to restrain inflation within 14 percent. He noted that theCPI index should be reduced to 8 percent over the next several years.Commenting on the draft monetary policies, Kasyanov stated that parametersof economic growth proposed by the Central Bank coincided with the Cabinetdraft. In particular, the Central Bank proposes the policy of the so-calledfloating ruble exchange rate, which is the main indicator for domesticeconomic entities. At the same time, authorities plan to increase the roleof the Central Bank in regulating the monetary supply via the interestrate. According to Kasyanov, the rate of interest should become anadditional indicator for economic entities, more important than thecurrency exchange rate.Another task of the Central Bank for 2003 will be to provide a stablenational currency rate, which, however, should be adequate to the economicsituation. Kasyanov stated that the draft on single state policies was forthe first time elaborated on according to amendments to the law on theCentral Bank. The amended law contains monetary estimates and forecasts..