The Bank of Russia at a meeting of the Board of Directors on July 21 decided to increase the key rate by 100 basis points, to 8.5% per annum, the Central Bank said in a statement.
Prior to this, the Central Bank of the Russian Federation kept the key rate at the level of 7.5% six times in a row; this indicator has been in place since September 19, 2022. At a meeting on June 9, the regulator allowed a rate increase at the next meeting.
The regulator allowed the possibility of a further increase in the reference rate in the next meetings to stabilize inflation around 4% in 2024 and beyond. According to the forecast of the Bank of Russia, taking into account the current monetary policy, annual inflation will amount to
- Analysts also called the possibility of raising the key rate “almost inevitable” but agreed to a 50bp increase. at the current meeting – up to 8% per annum. “An increase in the key rate seems almost inevitable. According to our estimates, the rate may increase by 50 bp. – up to 8% (which is inherent in market expectations), although a further step of increase is not excluded, ”predicted Olga Belenkaya, head of the macroeconomic analysis department at FG Finam.
- Georgy Voronkov, asset manager at PSB Management Company, also assessed the probability of raising the key rate from 7.5% to 8% as “high”. “This year it can grow up to 8.5% per year,” said the expert.
The Central Bank also noted the increase in inflationary pressure. The current rate of price growth has exceeded 4% on an annualized basis and continues to grow. The annual inflation rate is also increasing. As of July 17, the annual growth rate of consumer prices increased to 3.6% after 2.5% in May and 3.3% in June.
The Bank of Russia also gave a forecast according to which the growth rate of GDP will be
Author:
anastasia mariana
Source: RB
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