Nabiullina announced the minimal impact of strict monetary policy on economic growth
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The head of the Central Bank (CB) Elvira Nabiullina confirmed that the regulator may move to lower the key rate in the second half of this year. A change in policy will only be possible if inflation declines. The head of the Central Bank warned about the risks of premature easing of monetary policy and said that the impact of tight monetary policy on economic growth is minimal.
“Tight monetary policy slows down inflation, but its restraining effect on economic growth is minimal. The economy continues to demonstrate impressive growth rates,” said Elvira Nabiullina during her speech in the State Duma.
According to her, the experience of many countries shows that a premature reduction in rates can provoke a second wave of inflation, which will be more difficult to cope with than the first. “If inflation continues to slow down steadily, we assume that we will be able to begin reducing the key rate this year, most likely in the second half of the year,” Ms. Nabiullina clarified.
The news is being updated.
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