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. Last Updated: 07/27/2016

Gref Upbeat on Market Volatility

Volatility on world financial markets stemming from the U.S. subprime mortgage crisis will not hurt foreign direct investment into Russia, Economic Development and Trade Minister German Gref said Friday.

Analysts say a liquidity squeeze in the banking sector caused by the flight of around $10 billion in portfolio capital last month might make it hard for companies and banks to refinance their borrowing and keep investing.

But Gref said investment in the real economy was still going strong across all sectors.

"We are looking at raising, not cutting, our investment [forecast]. In pretty much all sectors we are exceeding our target by half," Gref told reporters.

"We won't change our economic growth forecast -- and we definitely won't cut it."

Russian officials currently target growth of around 7 percent this year.

Capital investment in Russia was up 24.7 percent in July from a year ago. In a monthly poll, economists said they expected it to rise by 19 percent for the year as a whole.

Gref also said he saw no reason to change the government's forecast that inflation will end the year at 8 percent.