The Russian Central Bank decided to reduce its key interest rate for 100 base points on Friday – at 20 percent. This is the first reduction rate from September 2022. years.
The key rate is now at the lowest level in the last nine months, which is the result of a gradual weakening of inflation in the country.
“Current inflationary pressures, including fundamental, continue to weaken,”, stands in the bank statement.
The Central Bank notes that the growth of domestic demand continues to exceed the supply of goods and services, but the Russian economy gradually returns to a balanced growth trajectory.
Restrictive monetary policy will remain in force until the inflation target was set up in 2026. year, the bank points out, and the BA reports.
“Further decisions on key interest rates will be made in accordance with the dynamics of inflation and inflation expectations, with the current monetary policy, the increase in the general price in 2026. And retain on that target level,” said in a statement.
After the beginning of the conflict between Russia and Ukraine, the reference interest rate increased abruptly to 20 percent. From the end of 2023. by the end of July 2024, the rate was held at a level of 16 percent, with four consecutive increases in 2024. years. The last increase was 25. Okotbra 2024, when the rate was raised for 200 base points – 21 percent.
In April, the annual inflation in Russia was 10.2 percent, and the goal of the Central Bank was its reduction in four percent.
