RZB: Russia: President Putin backs Medvedev in presidential race

Russia: President Putin backs Medvedev in presidential race

President Vladimir Putin supports First Deputy Prime Minister Dmitry Medvedev, chairman of Russian gas monopolist Gazprom, as a presidential candidate.
This puts an end to months of speculations about Putin’s handpicked sucessor. Putin said, he “has known Medvedev very well for over 17 years and completely and fully supports his candidacy “.
Russian news media reported that Medvedev is backed by four parties: the winner of parliamentary elections of 2 Dec “United Russia”, “Fair Russia”, which is also part of the new elected Duma, and finally the smaller parties “Agrarian Party” and the “Civil Force”. Medvedev’s official candidacy will be probably announced on 17 Dec, when Putin’s United Russia holds a party congress.
Medvedev is perceived as more business friendly than former defence minister Ivan Ivanov, who was also seen as a potential successor.
As Putin is highly popular in Russia, his personal recommendation is critical in forthcoming presidential elections on 2 March 2008.

Market reaction

The rouble rate against the dual currency basket didn’t change much and stayed at 29.61. EUR/USD exchange rate development continues to be the main driver of the rouble.
The Russian stock market soared after Vladimir Putin named Dmitry Medvedev as his favoured candidate. The leading index RTS jumped by roughly two percent. Medvedev is also the chairman of the board of directors of Gazprom which sent the gas giant\'s stock price up by approximately three percent. We judge the nomination of Medvedev as a positive sign for the Russian stock market. The chance that we will see a continuation of Putin’s politics increased.