Acting Prime Minister Yegor Gaidar told the Russian legislature Tuesday that industrial production was plummeting, prices were rising and the government budget deficit was growing to dangerous levels.
Gaidar promised cuts in spending and said monetary policy would have to be tightened "so as not to allow the collapse of the financial system."Speaking at the opening of the fall session of the Supreme Soviet, Gaidar blamed many of the nation's economic problems on new loans to major enterprises, a policy carried out independent of the government by the Russian Central Bank.
While he did not mention the bank's name, he and President Boris Yeltsin have been pressing for control of the institution now controlled by the legislature, to bolster their control over the money supply.
As Gaidar delivered his gloomy forecast, the ruble fell to a record low of 241 rubles to the dollar. The price, set at auction in the Moscow Foreign Currency Exchange, was down from 205.50 rubles per dollar set at the previous trading session on Thursday.