This week an interesting controversy arose in the media after Russia's ministry of economy released its own estimate for capital outflow in January. The ministry estimates that about USD 17bn in capital outflow for January 2011 compared to the USD 14bn outflow last December. This estimate looks particularly doubtful because: a) our own calculating shows a smaller USD 12bn capital outflow; and b) rouble firming against major foreign currencies did not speak much in favour of larger capital outflow too.

In a follow up comment, on February 21, the central bank of Russia released its own estimate and played down the issue of capital flight. According to the bank net capital outflow slowed from USD 14bn in December 2010 to USD 11bn in January 2011 whereas technically speaking a larger inflow of FX cash from exports into money market contributed to increasing net capital outflow. All in all, contrary to the ministry of economy the central bank figure shows that net capital outflow did slightly decrease in January 2011.

In agreement with the central bank we believe a large part of the outflow in January occurred due to the so-called technical statistical factors. In the opinion of the bank a substantial increase in gross turnover for FX transactions which automatically lead to larger net capital flow balance. So far the bank does not see any major problem at the moment concerning capital outflow.