Board of Directors of the Bank of Russia on September 12 decided to reduce the key rate by 100 B.P., to 17.00% per annum. This is stated in the regulator’s report on September 12th.
“sustainable indicators of the current price growth have not changed significantly and mainly remain higher than 4% in terms of the year. The economy continues to return to the trajectory of balanced growth. In recent months, the growth of lending has been activated. Inflation expectations have remained high,” the message said. Russia will maintain such rigidity of monetary conditions that is necessary to return inflation to the goal in 2026.
“Further decisions at the key rate will be made depending on the stability of the slowdown and dynamics of inflation expectations. According to the forecast of the Bank of Russia, taking into account the conducted monetary policy, the annual inflation will decrease to 6.0-7.0% in 2025 will return to 4.0% in 2026 and will be on the target in the future, ”the head of the Central Bank Elvira Nabiullin said that two options were considered at the meeting. Two options were considered at the meeting. The monetary conditions have significantly softened. From the end of 2023 to the end of July 2024, the rate was held at 16 %, while in 2024 the regulator raised it four times in a row. At a meeting on June 6, the Bank of Russia for the first time since September 2022 moved to mitigating the monetary policy, reducing the key rate from 21 %to 20 %, and in July – to 18 %. Inflation in the country of about 9.5%, the bank intends to reduce this bar to 4%.