How much will the cost of real sector products at a rate of 21% increase?
It is logical that the price of the final product will also increase.
In the best of times (2021), the discount rate of the Central Bank of the Russian Federation was at 4.5%, today it is 21%, an increase of 16.5%.
That is, for example, an operating enterprise in conditions of 100% crediting of its working capital, the share of which to the volume of the average annual cost is about 30%, will increase its costs by 5% (30% x 16.5%), where the share of working capital is 50% - an increase of 8.3% (50% x 16.5%), and where above 70% is an increase of 12% and above.
And here is a logical conclusion: the less efficient production management is, the more "fat" banks remove. There is a great need for lending, which means that financial costs for the real sector are growing, which is income for banks.
Minimizing the consequences could be achieved by reducing the credit burden on current activities. But how do you imagine the work of the real sector to be 100% at your own expense - without cash gaps, etc.?
Since we work in market conditions, the price uncovered by effective demand will require the manufacturer to reduce it. And these are losses and all the ensuing consequences for the economy.
The investment component (long-term lending) is not even touched yet.
As you can see, the relevance of high-quality economic management in conditions of expensive money will only grow. The ability to properly manage resources (to ensure a minimum amount of working capital to generate the cost of their products) can, to a certain extent, smooth out the negative effects of the discount rate.
