Business Ombudsman Boris Titov challenged the Central Bank’s move to raise the interest rate, arguing that the policy responds only to immediate hurdles and does not lay the groundwork for long-term growth. He shared his view on his Telegram channel, presenting a candid take on monetary policy and its economic repercussions.
Titov warned that the current monetary stance could lead to a freeze in economic activity. He observed that demand in the country has picked up, yet the Central Bank has tightened conditions to manage the situation. He also pointed out a persistent weakness in domestic supply for many goods, suggesting that the economy could become vulnerable to shifting winds if these imbalances persist. [Citation: Central Bank press release]
According to Titov, the key to sustaining growth lies not in higher borrowing costs, but in addressing labor shortages and attracting workers to Russia. He argued for policies that would ease the path for those willing to come and contribute to the economy, rather than relying solely on monetary tightening to curb inflation and slow activity. [Citation: Central Bank press release]
At its latest meeting, the Central Bank decided to raise the policy rate by a further 0.01 percentage point, bringing it to 13 percent per year. The move was framed as a step to normalize monetary conditions and keep inflation in check amid evolving economic pressures. [Citation: Central Bank press release]
Earlier forecasts suggested a potential strengthening of the ruble by year-end, with some observers anticipating firmer exchange dynamics as the domestic economy absorbs policy shifts and markets adjust to new levels of demand and supply. [Citation: Central Bank press release]