At the next Central Bank meeting on September 15, the bank will most likely increase the key interest rate. This forecast was given by Finam and PSB analysts interviewed by socialbites.ca.
Olga Belenkaya, head of the macroanalysis department of the Finam financial group, thinks that some inflation indicators have exceeded forecasts and the risk of inflation rising is high. This could force the Bank of Russia to increase the key rate.
“The signals given by the Central Bank at the beginning of September show that its stance is quite hawkish.” “From the statements of Central Bank President Elvira Nabiullina, it is understood that maintaining or increasing the interest rate will be discussed in the upcoming meetings,” Belenkaya believes.
According to him, a rate cut seems unlikely until there is a steady slowdown in inflation. In addition, analysts’ forecast for 2024 increased from the Central Bank’s target of 4 percent to 4.5 percent. And to achieve 4% inflation in 2024, the regulatory authority cannot ignore this.
“We believe that the Central Bank will consider the options of both keeping the interest rate at 12% and a possible increase of 100-150 basis points. “The interest rate hike scenario now looks more likely,” predicts Belenkaya.
General Director of Investments of PSB Management Company Nikolai Ryaskov agrees with him. “In the upcoming meeting, the Central Bank of Russia may increase the interest rate by 50-100 basis points,” Ryaskov said.
Chairman of Sberbank German Gref on the eve of EEF expressed Confidence that the Central Bank’s high interest rate of 12% will not remain for a long time. According to him, the regulator will begin a cycle of easing monetary policy in a few months. “Once the impact of the measures taken becomes clear, the Central Bank will start the interest rate reduction cycle in 3-6 months,” he added. Therefore, according to the head of Sberbank, 12% in the key interest rate is a temporary measure and we should expect the regulatory body to switch to easing the policy in the coming months.
Previously, the Central Bank of the Russian Federation harshly raised up to 12% key rate in an unscheduled meeting.