The head of Russia’s Ministry of Construction and Housing and Social Services, Irek Fayzullin, told reporters that the ministry will not introduce new measures to bolster the sector in response to the Central Bank’s higher key rate. He explained that the focus remains on projects that were already launched, noting that mortgage programs are still being managed even after the rate increase.
Fayzullin highlighted that ministry experts are evaluating multiple scenarios for how the construction industry might evolve in the coming months. They are preparing contingency plans to adapt to shifting economic conditions and to ensure ongoing support for housing initiatives where possible.
On July 21, Elvira Nabiullina, the Governor of the Central Bank of Russia, stated that the bank’s Board of Directors considered several options, including the possibility of a 75 basis point rise or a 100 basis point increase. The discussions also included proposals that were more aggressive.
According to the bank, the central rate was raised by 100 basis points for the first time since September 2022, bringing the key rate to 8.5 percent per annum. This move was part of a broader assessment of the monetary policy landscape and its implications for lending, demand, and inflation expectations.
Earlier remarks from the central bank suggested that a further tightening of policy could occur, depending on evolving macroeconomic indicators and the inflation outlook. The decision to adjust the rate reflects the authorities’ intent to retain policy flexibility while monitoring the effectiveness of existing measures for the real economy and financial stability.