-Russia and China boost co-operation
The Eastern Economic Forum that was held last week in Russia's far eastern city of Vladivostok saw a marked increase in the already record-high economic cooperation between Russia and China.
The largest Russian and Chinese bilateral deal made during the forum was on e-commerce. The Chinese Alibaba Group and Russian companies, Megafon, Mail.ru and the Russian Direct Investment Fund (RDIF) will establish the largest e-commerce company to operate in Russia and the Commonwealth of Independent States (CIS). The implementation of the 'biggest' deal in Russia's e-commerce sector is planned for the first quarter of 2019.
Other prominent developments include the supportive sentiments expressed by Russian and Chinese leaders to opt for the increased use of national currencies in trade instead of using dollars.
Russian President Vladimir Putin said Russia supports the use of national currencies in trade with China, adding that, “The use of national currencies in mutual trade will increase the stability of banking systems in line with the increasing risks in global markets.”
Meanwhile, Chinese President Xi Jinping said global developments are becoming more “unstable and unpredictable.”
“In the light of these developments, cooperation between Russia and China is gaining importance. Together with the international community, we will look for solutions to the problems, and we will stand against unilateralism and trade protectionism,” Xi said.
In his speech at the forum, the Minister of Economic Development of Russia Maksim Oreshkin stated that due to the U.S.' protectionist steps, many countries around the world have started to move away from trading in dollars.
-Russian Central Bank increases interest rates for time in 4 years
The Russian Central Bank increased its interest policy rate to 7.5 percent for the first time since December 2014.
In the statement made by the bank on Friday, it said the interest rate was increased by 0.25 basis points to 7.5 percent due to heightened inflation risks. The statement showed that some of these risks were due to oil price fluctuations and potential changes in consumer behavior.
Since early 2015, the Central Bank of Russia, which had gradually lowered interest rates from 17 percent, had decreased its policy rate to 7.25 percent.
Due to the possibility of round of U.S. sanctions on Russia in retaliation for the poisoning of former Russian agent Sergey Skripal and his daughter in the U.K., the Russian ruble started the week with a drop in value, rising above 70 against the dollar for the first time since March 16, 2016.