Moscow - Saba:
The Central Bank of Russia cut its key interest rate on Friday for the first time in nearly three years, amid declining inflation and signs that the economy is suffering from the effects of high borrowing costs.
Bloomberg News reported that the central bank cut the interest rate by a full percentage point to 20%.
The central bank said in a statement that "current inflationary pressures, including core inflation pressures, continue to decline... The impact of tight monetary conditions on demand is becoming increasingly evident in the form of declining inflationary pressures."
It is worth noting that members of the Russian Central Bank's Monetary Policy Committee have kept the interest rate unchanged since last October in an attempt to combat inflation that has exceeded double the target of 4%.
However, there have been signs of a slowdown in the pace of price increases, and calls have increased from ministers and business leaders to ease monetary policy to support the war-torn economy.
The Central Bank estimates that consumer prices slowed in April to 6.2% annually, after accounting for seasonal variables, compared to 7% in March. Renaissance Capital forecasts that the inflation rate for the past month was within the target range of 4%.
| more of (International) |