Preprint Article Version 2 Preserved in Portico This version is not peer-reviewed

Toward the Modeling of Russia's Monetary System

Version 1 : Received: 4 March 2020 / Approved: 5 March 2020 / Online: 5 March 2020 (11:54:49 CET)
Version 2 : Received: 19 September 2021 / Approved: 20 September 2021 / Online: 20 September 2021 (10:36:27 CEST)

How to cite: Borodachev, S. Toward the Modeling of Russia's Monetary System. Preprints 2020, 2020030086. Borodachev, S. Toward the Modeling of Russia's Monetary System. Preprints 2020, 2020030086.


The paper explains the dynamics of monetary aggregates in Russia with the help of country's trade balance, the creation of deposits by commercial banks and cross-border flows of rubles and (foreign) currency. The volumes of deposits and flows, in turn, depend on changes in the currency/ruble exchange rate and favorable external economic conditions. The model was estimated by the Kalman filter, the adequacy was confirmed by stimulation. Monthly money supply forecasts have an accuracy of ~ 1%. It was found that the volume of additional deposits created per month is ~ 300 billion RUB (this leads to real inflation of 9.5% per annum), money flows that are not related to payments for goods: rubles inflow from abroad ~ 100 billion RUB, currency goes abroad ~ 15 billion USD. With the growth / fall of the dollar exchange rate by 1 RUB per month, during the same month, the creation of additional ruble deposits and the arrival of rubles from outside decreases / increases by 0.114 billion USD. The increase of the Currency Reserve Assets of Russia is accompanied by going abroad ~ 5% of the increase.


broad money supply; currency outflow; money creation; exchange rate; Kalman filter


Business, Economics and Management, Economics

Comments (1)

Comment 1
Received: 20 September 2021
Commenter: S. M. Borodachev
Commenter's Conflict of Interests: Author
Comment: Improved and enlarged 
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