Bank of Russia: Digital Ruble Not Spark Inflation

Bank of Russia Assures Digital Ruble Will Not Impact Inflation Control or Financial Stability

The Bank of Russia has emphasized that the introduction of the digital ruble, the country’s Central Bank Digital Currency (CBDC), will not interfere with the government’s ability to control inflation or affect the money supply. According to the institution, the digital currency poses no risk to Russia’s financial stability and will not alter the core functions of the existing banking system.

Digital Ruble: No Threat to Russia’s Financial System, Says Central Bank of Russia

In a recent statement, the Bank of Russia clarified that the launch of the digital ruble would not disrupt the state’s monetary policy framework. In its draft strategy for 2025-2027, the central bank reaffirmed its commitment to using traditional tools to manage inflation, regardless of the introduction of the digital ruble. The bank also assured that the new CBDC would not compromise financial stability or hinder the role of commercial banks in the economy.

Bank of Russia Reaffirms Digital Ruble Won’t Alter Monetary Policy Tools

In a recent document, the Bank of Russia reassured that the introduction of the digital ruble will not interfere with its ability to implement monetary policy. The central bank stated, “The emergence of a digital form of the national currency will not affect the mechanisms for implementing monetary policy.”

The bank also highlighted that it will continue managing money market rates by providing liquidity to banks and absorbing excess liquidity, as it currently does.

Retail-Focused CBDC: Digital Ruble to Enable Direct Payments for Consumers

Russia’s Central Bank Digital Currency (CBDC) is designed as a retail currency, allowing everyday users to make direct payments, similar to China’s digital yuan. This stands in contrast to the CBDC models being explored by some other nations, which are more focused on facilitating interbank transactions and improving the financial network infrastructure.

Analysts Express Concerns Over Digital Ruble’s Impact on Russian Economy

Despite concerns from analysts about the potential economic impact of the digital ruble, the Bank of Russia has reassured that the CBDC will not contribute to inflation. According to the bank, the digital ruble will increase demand for cash and bank account funds, but will not lead to excessive money issuance.

Two-Tier Banking Structure to Remain Intact with Digital RubleThe Bank of Russia has also confirmed that the existing two-tier banking system will stay in place. Credit institutions will continue to serve as lenders and custodians of savings, while supporting the integration of the digital ruble. Banks will offer customers the ability to open digital ruble accounts and perform transactions using the new currency.

Digital Ruble: A New Payment Option Expected by 2025

The Bank of Russia emphasized the benefits of the digital ruble, highlighting it as an alternative to traditional payment methods and monetary systems. Authorities project widespread adoption of the digital ruble by 2025, marking a significant step in Russia’s financial evolution.