The increase in the key rate of the Central Bank of Russia to 20% is completely expected. About this on Radio 1 stated economist Denis Raksha. According to him, the regulator’s further decision will depend on inflation dynamics and inflation expectations.
“Inflation expectations are no less important than the current level and dynamics of inflation, because they show how consumers, both individuals and companies, behave. Is the expert ready to spend money here and now, or does he prefer to save?
Alina Dzhus/socialbites.ca
He added that the high Central Bank interest rate should attract money into various financial instruments such as bank deposits, securities, etc.
On September 13, the Central Bank for the second time this year raised Key rate – up 100 basis points immediately, to 19% annually. The regulator explained its decision amid high inflation pressure.
The Central Bank is allowing an interest rate hike at its next meeting on October 25. According to its forecast, considering current monetary policy, annual inflation will fall to 4.0-4.5 percent in 2025 and will remain close to 4 percent in the future.
The central bank raised the interest rate five times in 2023, to 16% annually in December. It was then held at that level four times. On July 26, 2024, the regulator raised the rate from 16% to 18%.
Previously the Central Bank stated On the need to further tighten monetary conditions.
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Source: Gazeta
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