Regulatory Announcements

The Bank of Russia Cuts the Key Rate by 25 bp to 6.25% p.a. 

On 13 December 2019, the Bank of Russia Board of Directors decided to cut the key rate by 25 bp to 6.25% per annum. Inflation slowdown is overshooting the forecast. Households’ inflation expectations continue to decrease. Price expectations of businesses remain overall unchanged. The growth rate of the Russian economy increased in Q3; however, its stability has yet to be assessed. Risks of a substantial global economic slowdown persist. Disinflationary risks still exceed pro-inflationary risks over the short-term horizon. Given the monetary policy stance, annual inflation will come in at 3.5–4.0% in 2020 and will remain close to 4% further on.

If the situation develops in line with the baseline forecast, the Bank of Russia will consider the necessity of further key rate reduction in the first half of 2020. In its key rate decision-making, the Bank of Russia will take into account actual and expected inflation dynamics relative to the target and economic developments over the forecast horizon, as well as risks posed by domestic and external conditions and the reaction of financial markets.

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