The Central Bank raised the key rate for the fifth time – 16% – Kommersant
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At a meeting on December 15, the Board of Directors of the Central Bank (CB) raised the key rate for the fifth time in a row. It was increased by 100 basis points (bp) – from 15% to 16% per annum. The regulator explained its decision by high inflationary pressure. In October-November, seasonally adjusted price growth amounted to 10.0% annualized.
“The Bank of Russia will make further decisions on the key rate taking into account the actual and expected dynamics of inflation relative to the target, economic development over the forecast horizon, as well as assessing risks from internal and external conditions and the reaction of financial markets to them. According to the forecast of the Bank of Russia, taking into account the current monetary policy, annual inflation will drop to 4.0–4.5% in 2024 and will be close to 4% in the future,” the statement says. message Central Bank.
The Central Bank began its rate hike cycle on July 25. Then it was increased from 7.5% to 8.5%. Prior to this, the Central Bank kept the rate unchanged from September 19, 2022. Its change was associated with the rise in inflation that began in the country.
In October, the Central Bank raised its inflation forecast for 2023 to 7-7.5% from 6-7%. At the end of October, annual inflation accelerated to 6.69%, and in November it amounted to 7.5%. In December it slowed to 7.04%. However, yesterday, December 14, during the “Results of the Year,” President Vladimir Putin said that at the end of the year the figure could be 7.5%, “maybe a little more, towards 8 percent.”
Head of the Central Bank Elvira Nabiullina in November admittedthat the regulator may start reducing the rate next year, when annual inflation approaches the target of 4%.
How the key rate affects bank loans – in the material “Key Argument for Lending”.
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