Banking sector liquidity forecast for 1-week auction limit
The Central Bank of Russia (CBR) has published its forecast of banking sector liquidity factors. This forecast determines the limit for its 1-week repo auction scheduled for March 3, 2026.
Key Factors Shaping Ruble Liquidity
The CBR's forecast for the 1-week repo auction on March 3, 2026, details several key factors impacting banking sector liquidity.
Balances on correspondent accounts with the CBR are projected to increase by 323 units, indicating an inflow of ruble liquidity to credit institutions.
Conversely, cash in circulation outside the CBR is expected to decrease by 101 units, which implies a withdrawal of cash from the economy.
General government accounts with the CBR and other items are forecast to decrease by 36 units, suggesting a reduction in government balances.
The balance of the CBR's own liquidity management operations and domestic FX market interventions shows a significant withdrawal of 3,174 units.
Based on these factors, the limit for the CBR's 1-week repo auction on March 3, 2026, has been set at 2,990 units.
Interpreting the Liquidity Flows
Understanding the signs associated with each factor is crucial for interpreting liquidity flows.
A positive sign for correspondent accounts indicates an increase in bank balances, while for cash in circulation, a positive sign means a decrease in cash outside the CBR.
For general government accounts, a positive sign denotes a decrease in balances.
In contrast, for the balance of CBR operations, a positive sign signifies a supply of liquidity to the banking sector, while a negative sign, as seen in the forecast, indicates a withdrawal of funds by the CBR.
These calculations are made at the beginning of the forecasting period, incorporating previous transactions and standing facilities.