The so-called Russian tax manoeuvre poses a crucial
risk for the years to come, as it will be gradually implemented through 2019-2024. A negative impact on external and fiscal accounts is already expected to materialise in 2019, if the issue is not resolved through ongoing negotiations. Especially the fiscal situation, that
has already taken a turn for the worse at the end of
2018, is likely to deteriorate further.
Inflation, which amounted to 4.9% on average in 2018,
has reached historically low levels and can be expected to remain firmly under the National Bank’s
control in 2019. The external situation in 2018 was
characterised by a stable exchange rate, but also a
widening current account deficit. The latter is projected to further worsen in 2019, as the Russian tax
manoeuvre unfolds. Exports and imports continue to
grow dynamically, but are still on their way to catch
up to their 2012 highs. The growth of foreign exchange
reserves came to a standstill; they will likely remain at
the same level in 2019.