Moscow, May 26 (Tian Bing and Zhang Yuchen) The Central Bank of Russia announced on the 26th that it has decided to reduce the benchmark interest rate from 14% to 11% from the 27th.This is also the third time since April that the Bank of Russia has cut the benchmark interest rate by 300 basis points.
The Russian central bank issued a statement on the same day, saying that data in recent weeks showed that the current rate of price growth has slowed sharply.The stabilization of the ruble exchange rate and the marked decline in inflation expectations in the civil and commercial sectors have contributed to the easing of inflationary pressures.Inflation in Russia reached 17.8% in April, but had slowed to 17.5% as of May 20, a faster decline than the Bank of Russia had forecast in April.
The Bank of Russia also pointed out that ruble time deposit funds continued to grow, while lending activity remained low.External conditions for the Russian economy remain difficult, significantly constraining economic activity.High inflation and financial risks have eased, allowing for easing of monetary conditions and capital controls.
The Bank of Russia said that it will further adjust the benchmark interest rate in the future.According to Russia's actual inflation and expectations, the process of economic restructuring, internal and external risk assessment, and financial market reactions, the possibility of continuing to lower the benchmark interest rate will be reviewed at the next central bank board meeting.It is reported that the next meeting of the board of directors of the Russian central bank is scheduled for June 10.
According to the forecast of the Central Bank of Russia, taking into account the current monetary policy, the annual inflation rate in Russia will drop to 5%-7% in 2023, and will return to the target value of 4% in 2024.
The day before, Russian President Vladimir Putin said when attending a special meeting on people's livelihood security that Russia's current economic situation is better than expected, and the inflation rate is expected to be lower than 15% by the end of the year.
After Russia announced a special military operation in Ukraine on February 24, the United States and the West announced a series of large-scale sanctions against Russia, and the ruble depreciated rapidly and sharply, once exceeding 120 rubles against the US dollar.The Russian official took a series of measures to stabilize the market, including sharply raising the benchmark interest rate from 9.5% to 20% at the end of February. Since then, the ruble exchange rate has gradually strengthened and stabilized, and has returned to the level before the conflict between Russia and Ukraine.The Central Bank of Russia announced on April 8 that it would cut the benchmark interest rate from 20% to 17%, and on April 29 it announced that it would cut the benchmark interest rate from 17% to 14%.(Finish)
