The deputy chairman of the Central Bank allowed a tightening of monetary policy in 2024

The Bank of Russia allows for a tightening of monetary policy (MP) next year to return inflation to the target, said deputy chairman of the regulator Alexei Zabotkin, speaking in the State Duma.

“To return inflation to the 4% target in 2024, in our opinion, it will be necessary to maintain monetary policy stringency over the next year, and we do not rule out that additional stringency may be required beyond the decisions already taken,” he said (quote via Interfax).

Annual inflation in the Russian Federation as of October 2 was 5.9%, and inflation risks now prevail, Zabotkin added.

On August 15, the Central Bank raised the key rate by 3.5 percentage points to 12%. The reason was increased inflationary pressure and inflationary expectations, which are pressured by exchange rate dynamics. On September 15, the regulator raised the key rate by 1 percentage point to 13%. The Central Bank will keep the key rate at an increased level for “quite a long time,” said the chairman of the regulator, Elvira Nabiullina.

Previously Rosstat reportedthat inflation in Russia from September 26 to October 2 was 0.21%, from the beginning of October – 0.06%. Since the beginning of 2023, prices have increased by 4.54%.

At a government meeting dedicated to budget priorities for 2024-2026, Minister of Economic Development Maxim Reshetnikov gave a forecast according to which inflation growth will slow down to 4.5% by the end of 2024, and will reach 4% in 2025.