Regulatory Announcements

The Bank of Russia Cuts the Key Rate by 25 bp to 4.25% p.a.

On 24 July 2020, the Bank of Russia Board of Directors decided to cut the key rate by 25 bp to 4.25% per annum. Disinflationary factors continue to exert considerable influence on inflation. Household and business inflation expectations have overall stabilised following a decrease in May-June. The recovery of the global and Russian economies will be gradual despite the fact that the easing of restrictions revives economic activity. In these circumstances, there is a risk that in 2021 inflation might deviate downwards from the 4% target. A significant easing of monetary policy since April aims at curbing this risk and stabilising inflation close to 4% over the forecast horizon. According to the Bank of Russia’s forecast, given the current monetary policy stance, annual inflation will reach 3.7-4.2% in 2020, 3.5-4.0% in 2021 and will stand close to 4% later on.