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Date: 5 days ago   Category: Finances

By "the index of Big Mac" ruble — the most underestimated currency. Whether so it?


The Economist issued the next "index of Big Mac" showing "fair" exchange rate on the basis of burger cost in the USA and other countries. What not so in these calculations and why you should not perceive this index seriously? Photo: Valery of Sharifulin/TASS Ruble — the most underestimated world currency. Proceeding from "the index of Big Mac", the cost of ruble is 70% lower than a fair course, writes the British magazine The Economist. This edition calculates more than 30 years "the index of Big Mac" when burger cost in the USA is taken as a basis and is compared to the price in other countries. So, in the USA "Big Mac" costs 5.6 dollars, in Russia is nearly 3.5 times cheaper. Means, the ruble is underestimated, experts of the magazine conclude. However, in calculations the cost of "Big Mac" in 110 rubles whereas in the Russian McDonald’s in the last several years it costs 130 rubles is specified. If to count the index taking into account the real price then which is the most underestimated by currency in the world there will be not a ruble, but the Ukrainian hryvnia, "Jellyfish" notes. Economists never perceived "the index of Big Mac" seriously, the head of department of analytical researches of UK "Uralsib" Alexander Golovtsov says: Alexander Golovtsov the head of department of analytical researches of UK "Uralsib" "Is a clean pop-music just for drawing attention of readers, it covers very small, very narrow piece of consumption of households and very small portion of all economy of each country. Out of the corner of the eye I monitor many years this index, the location of the countries in it is more or less stable: where the currency is considered overestimated — Switzerland, Japan, it remains 20 years overestimated where it is considered underestimated — in Third World countries, Russia, in Ukraine and so on — it is eternally underestimated. Therefore it is hardly possible to draw a close attention to the index. If the ruble is underestimated by scientific methods to consider at par purchasing power, roughly speaking, percent on thirty, but it is too purely theoretical indicator which not really affects the market. The exchange rate is influenced very strongly by capital flows which in a case with Russia steadily are outflow. In the conditions of chronic outflow the currency will be always underestimated". The head of the analytical department of Grand Capital Sergey Kozlowski agrees that the ruble is underestimated, but not in that degree in what shows "the index of Big Mac": Sergey Kozlowski the head of the analytical department of Grand Capital "Is approximate model, attempt to estimate the cost of identical goods and thus to transpose it on assessment of purchasing power parity, not estimating logistics at all, estimating only products, not estimating production of these products, delivery and so on. Therefore it is worth looking at this index in terms of populism. If to continue speculation on a subject, the ruble is underestimated or overestimated, then it anyway will give nothing. Yes, the Russian ruble is under pressure, including because of actions of the Russian financial authorities — I mean the taken place and expected interventions. The central bank after all in

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