This paper examines the finance-growth nexus in Russia with the vector autoregression model, taking oil prices and foreign exchange rates into account. The analyzed period is from 1999 through 2008 (Subperiod 1) and from 2009 through 2014 (Subperiod 2). The results for Subperiod 1 suggest that there is causality from economic growth to money supply and bank lending, which implies demand-following responses. The results for Subperiod 2 show that economic growth Granger causes bank lending while there is no causality from money supply to economic growth, which could be related to the dramatic decrease in the amount of intervention in foreign exchange markets.

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This paper investigates the spillovers of US conventional and unconventional monetary policies to Russian financial markets using VAR-X models. Impulse responses to an exogenous Federal Funds rate shock are assessed for all the endogenous variables. The empirical results show that both conventional and unconventional tightening monetary policy shocks decrease stock prices whereas an easing monetary policy shock does not increase stock prices. Moreover, the results suggest that an unconventional tightening monetary policy shock increases Russian interest rates and decreases oil prices, implying reduced liquidity in international financial markets.

This paper examines whether a bank lending channel exists in monetary policy transmission in Russia, employing Russian bank-level data from 2005 through 2012. The results of specifications suggest that banks with less capital tend to react more sensitively to changes in monetary policy. Furthermore, this study finds that smaller, more liquid and/or better-capitalized banks were likely to have more rapidly growing loan portfolios, and larger banks tended to attenuate the crisis shock.

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