Bank of Russia decision in July?Increase

On Friday, the Central Bank of the Russian Federation was seriously considering cutting the interest rate by 0.25 percentage points and maintaining it at 14.25%. There were also proposals for an increase – Nabiullina

The Central Bank has lowered its key rate for the tenth time in a row, this time to 14%. The significant price increase and increased inflation expectations in the summer months were largely due to one-off factors, the regulator noted. The estimate for sustainable inflation remains in the range of 4-5% on an annualized basis. The baseline scenario assumes an average key rate of 14.5-14.6% per annum in 2026 and 10.5-12.5% ​​per annum in 2027, the Central Bank reported. How the rate has changed over the past 13 years - in the RBC infographic. RBC channel on "Max" RBC app for iOS and Android [in reply to: The Board of Directors of the Bank of Russia cut the key rate by 25 basis points at the meeting on July 24 - to 14%, the regulator said in a statement. This is the tenth meeting in a row that the Central Bank has eased monetary policy. But in the last two meetings, it has done so in more careful steps - 25 bp. instead of the previous 50 bps. The Central Bank's decision did not match market expectations: 26 of the 30 participants in the RBC consensus forecast (analysts from large banks and investment companies) predicted that for the first time in a year, the regulator would leave the rate unchanged—at 14.25%. Only two allowed for the possibility that the Bank of Russia would not interrupt the easing cycle and cut the rate by 25 bps, while two more experts called both options equally likely. RBC channel on "Max" RBC app for iOS and Android]

The economy as a whole grew at a moderate pace in the second quarter of the year, the Central Bank said in a statement following the meeting of the regulator's Board of Directors. Due to a significant increase in fuel prices, the annual inflation forecast was 6.0-7.0% in 2026. Max | Telegram | Newsletter | iOS App | Android [in reply to: The Central Bank has cut its key rate for the tenth time in a row, to 14%. The regulator's decision did not coincide with the consensus forecast of Vedomosti: only five of the 20 economists surveyed expected a rate cut, while three expected a 25 bp step. 14 experts expected the rate to remain unchanged. Max | Telegram | Newsletter | iOS App | Android]

"Let's try it?": German Gref suggested Elvira Nabiullina lower the key rate as an experiment. The discussion took place during the Bank of Russia's financial congress. Nabiullina stated that the Central Bank isn't a fan of high rates, but if they were to conduct an experiment and lower the key rate, she said, there would be a sharp increase in inflation. "Let's try it?" — the head of Sberbank interrupted her, causing laughter in the hall. "I am categorically against it, because this is an experiment in my own country," the head of the Central Bank of the Russian Federation responded. During the conversation, Gref also noted that in the economy, as in many other sectors, people want to hear only good news. "In English, there is even a term for it, 'party pooper' — a person who is sure to ruin a party. This does not apply to the Central Bank now, I am speaking in general," he clarified. "We have been working with you for so many years, it seems to me that you have never refused to argue with anyone, including the Central Bank," Nabiullina replied. Gref also addressed the audience and asked for a show of hands for those who believe that the economy is currently in a state of hypothermia and the risks of stagnation outweigh the risks of continued economic cooling. "For the viewers of the broadcast, I'll say that there weren't that many hands raised. Bank of Russia employees, in particular, didn't raise their hands," the moderator said, drawing laughter from the audience. The Chairman of the Central Bank of Russia, in turn, urged caution in using the term "hypothermia" in relation to the Russian economy. According to her, the dynamics of banks' reserve creation do not allow us to talk about such a phenomenon. More IZ RU news in MAX