Central Bank official on influence of Iraqi war on ruble rate

A short military action in Iraq will not influence the ruble rate, Senior Deputy Chairman of the Russian Central Bank Oleg Vyugin stated to journalists. According to him, only the US Federal Reserve System could influence the Russian ruble rate against the US dollar, changing its discount rate. As for the dollar rate against the Euro, Vyugin expressed an opinion that a short-term war on Iraq would not weaken the positions of the US dollar either, as the Euro rate had already started declining.

In the event the war is long, the dollar rate will gradually decrease, while oil prices will be advancing, the Central Bank official believes. According to him, so far one could forecast a maximum fall in the dollar rate by 4 percent. At the same time, Vyugin pointed out that in the event the dollar rate fluctuates abruptly, the Central Bank "does not see any reason for influencing the situation on the Russian currency market considerably". Recently, the Central Bank has practically stopped purchasing dollars; the market is being regulated by market makers, he pointed out.

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