The Central Bank is expected to pursue a gradual reduction in the key rate in the coming year, potentially reaching 6.5 percent annually. This stance was shared by Albert Koroev, head of the Stock Market Experts Department at the financial group BCS Mir Investments, during an interview with socialbites.ca. The current key rate stands at 7.5 percent per year. Koroev believes that at the upcoming Friday meeting of the Central Bank Board, the rate will be held steady before a possible one-point cut next year. [Source: Central Bank insights and market interviews]
According to Koroev, absent new shocks to the Russian economy or its banking sector, the central bank is likely to pursue a policy of gradual rate cuts in the year ahead. In that context, he emphasizes consideration of the lower end of the forecast range, which points to 6.5 percent per annum. This perspective aligns with the central bank’s tendency to calibrate policy to evolving macroeconomic conditions while avoiding abrupt shifts in financial conditions for households and businesses.
The analyst does not anticipate a meaningful rise in deposit rates or a steep drop in borrowing costs within the near term. Koroev notes that the regulator paused rate reductions in September and has adopted a wait-and-see approach since then. While deposit rates have edged higher, he does not expect substantial further increases, all else being equal. On lending to individuals, the regulator has signaled a push to reduce household indebtedness risks and has indicated there is little appetite to expand the preferred mortgage programs. Consequently, he expects limited downward movement in consumer loan rates in the early months of the coming year. [Source: Market commentary and regulator communications]
Earlier, the Central Bank of Russia outlined a medium-term forecast for 2023 that placed the key rate within a range of 6.5 to 8.5 percent per year. At present, the rate sits near the middle of that range, reflecting ongoing balancing between inflation dynamics, financial stability considerations, and the need to support economic activity. This context helps explain why forecasts for the next year lean toward gradual adjustment rather than rapid change. [Source: Central Bank projections and contemporary market analysis]