External Accounts To Remain Stable

We hold to our view for Russia's external accounts to stabilise further in 2010, with the current account surplus forecast to rise to US$82.7bn (5.1% of GDP) this year. Beyond this year, we still expect the current account surplus to decline in percentage of GDP terms, as oil export growth slows considerably and import demand rises on the back of a growing consumer sector. That said, with the net financial account expected to broadly remain in positive territory, the risks of a net balance of payments deficit are very limited. As a result, we maintain our forecast for Russian international reserves to rise steadily to US$600bn by end-2014.

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