Russia’s Central Bank decided, at its board meeting today, Friday, to reduce the basic interest rate by 1.5% to 9.5% per annum.
Thus, Russian Central returned the reference interest rate to its level last February before the application of Western sanctions.
A statement released by the Central Bank of Russia after the meeting read: “On June 10, 2022, the Board of Directors of the Bank of Russia (the Central Bank of Russia) decided to reduce the basic interest rate by 150 base score of 9 .5% annually. ”
The statement said that “external conditions for the Russian economy remain difficult and significantly limit economic activity. At the same time, inflation is slowing faster than expected and economic activity has dropped lower than the Central Bank expected. ”From Russia in April. 2022.
Regarding inflation rates in Russia, the central bank said that “the fall in the headline inflation rate was due to falling prices of a small group of goods and services after their strong rise in March.”
The central bank has also indicated that it will examine the possibility of lowering interest rates at upcoming meetings.
The decision of the Central Bank is in line with the expectations of analysts, who expect the Central Bank to reduce the basic interest rate to the level of 9% – 9.5% in the context of lower inflation in the country and the rise of the ruble against dollars and euros.
The following are the main points identified by the Central Bank at its meeting:
The Central Bank has lowered its inflation forecast for 2022 to 14%-17%, previously expected from 18%-23%.
The Central Bank expects inflation in 2023 to be at the level of 5% – 7%, and will reach 4% in 2024.
The Central Bank expects that the average basic interest rate in 2022 will be in the range of 10.8% – 11.4%, in 2023 in the range of 7% – 9% and in 2024 between 6% and 7%.
And at the end of last February, the Russian Central Bank abruptly raised the key interest rate by 10.5 percentage points at a time to 20% per annum, against the background of Western sanctions and currency market fluctuations.
Subsequently, with the stability of the financial and economic situation in Russia, the Central Bank began to gradually reduce the annual interest rate, which now reaches the level of 9.5%.
Following the decision of the Central Bank of Russia, the Russian currency rose and reached a level below 58 rubles per dollar for the first time in almost 3 weeks.
At 13:40 Moscow time, the dollar exchange rate dropped 2.28 rubles (ruble = 100 kopecks) to 57.07 rubles, while the euro exchange rate dropped 3.14 rubles to 60.14 rubles. .
Source: RT + RIA Novosti
Source: Arabic RT
