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Russia to start buying forex as Middle East war oil windfall arrives
Banknotes of Chinese yuan and Russian rouble are seen amid flags of China and Russia in this illustration picture taken September 15, 2022. REUTERS/Florence Lo/Illustration Purchase Licensing Rights, opens new tabMOSCOW, May 6 (Reuters) - Russia will buy foreign currency on the market in the coming month for the first time since before the start of the war in Ukraine, according to a Finance Ministry statement, as windfall revenues start to arrive from high oil prices triggered by the U.S. war with Iran.The Finance Ministry said it will buy 110.3 billion roubles ($1.46 billion) worth of forex, mostly Chinese yuan, from May 8 to June 4 for the National Wealth Fund, which is used to stabilise the budget. The move should also prevent the rouble from excessive strengthening. Sign up here.The central bank will carry out the purchases. When netted against the central bank's own operations, the state's net forex purchases will amount to 1.18 billion roubles a day compared to current sales of 4.6 billion roubles a day.Under Russia's budget rule, the government buys foreign currency for the wealth fund with tax revenues collected when oil prices exceed a certain cut-off point, currently set at $59 per barrel.If oil trades below that cut-off price, the government sells forex from the fund to cover the budget deficit. The ministry suspended operations for the fund in February amid low prices for Russian oil due to sanctions-linked discounts.The decision to suspend the transactions was aimed at preventing the fund from depletion. However, when oil prices soared after the closure of the Strait of Hormuz after the U.S. and Israel attacked Iran on February 28, many analysts questioned the logic of the move, which kept the rouble overvalued.The ministry said earlier it would take into account deferred transactions for March, when it would have sold forex, and April, when determining May volumes. Deferred sales for March would offset purchase volumes, softening the market impact.Russian state oil and gas revenues fell 21.2% year-on-year in April to 855.6 billion roubles ($11.32 billion), according to finance ministry data published also on Wednesday, but were up from 617 billion roubles in March.($1 = 75.6000 roubles)Reporting by Darya Korsunskaya; Writing by Gleb Bryanski; Editing by Mark TrevelyanOur Standards: The Thomson Reuters Trust Principles., opens new tab
Kotek proposes using $160 million from Oregon 'rainy day fund' for 1 ...
by Alex Baumhardt, Oregon Capital ChronicleDesperate for money to get through the next two wildfire seasons and with few proposals on the table that could meet costs and get passed by the Oregon Legislature, Gov. Tina Kotek is proposing to skim some money off of the state’s “rainy day fund.”Kotek at a news conference Monday proposed taking $161 million of interest income from the state’s nearly $1.9 billion budget reserve fund — meant to help the state smooth out revenue or expense fluctuations in times of economic downturn or recession — to provide funding for wildfire response and mitigation for the 2025-27 biennium to mitigation readiness.“We have only just weeks left in the session — days — without an immediate path for an ongoing funding mechanism. I urge the Legislature to identify as much one-time funding as they can,” she said. “I see no reason why they can’t get that at least done.”The 2025 fire season has already started, and Kotek last week declared a conflagration for the Rowena Fire near The Dalles, which has burned more than 3,500 acres and destroyed 56 homes. On Monday, the Conflagration Act was invoked for the Alder Springs Fire in Central Oregon. And federal aid for fires remains in doubt, as the Trump administration has pushed for states to shoulder more of the costs of responding to natural disasters.Kotek asked the Legislature for more than a year to come up with a reliable and consistent funding mechanism to support statewide wildfire work but has so far not received any proposals that come close to meeting her desired target of an additional $150 million per year and can get the bipartisan support needed to pass.She recently began signaling her support for using a portion of the expected $1.64 billion “kicker” tax rebate for wildfire funding, despite declining to consider it in the past. The rebate is sent back to Oregonians when actual revenue the state collects, including income taxes, exceeds the two-year revenue forecast by 2% or more.But any bill to change the kicker requires a two-thirds supermajority vote in each chamber, meaning at least two Senate Republicans and four House Republicans would need to approve along with all legislative Democrats.A recent proposal from Sen. Jeff Golden that would use $1 billion of the kicker for wildfire funding and send the remaining $650 million to Oregonians earning less than $95,000 a year would meet Kotek’s desire for sustained funding. The $1 billion would be put into an interest-bearing a...
Michigan Senate dips into rainy day fund for $88B budget plan
Michigan's Budget and Economic Stabilization Fund, often referred to as the rainy day fund, had about $2.2 billion available in it, as of February.
Ukraine-Russia war latest: Moscow threatens 'massive strike' in centre ...
Russia have threatened to launch a "massive retaliatory missile strike" on the centre of Kyiv if Ukraine attempts to disrupt their World War Two Victory Day celebrations. Vladimir Putin on ...
