MADRID, 26 May. (EUROPA PRESS) –
The Bank of Russia has decided to cut the reference interest rate by 300 basis points, which will thus stand at 11%, after detecting a slowdown in the evolution of price increases as a result in part of the appreciation of the ruble, which is at four-year highs against the dollar and seven-year highs against the euro.
The Bank of Russia was forced on February 28 to raise interest rates from 9.50% to 20% to urgently respond to the impact on inflation and the country’s financial stability of the international sanctions imposed by the West after the invasion of Ukraine.
The entity, which “keeps open the prospect of a reduction in the rate in its next meetings”, has highlighted that the latest weekly data point to a significant slowdown in the current growth rates of prices.
In this sense, the Russian central bank considers that inflationary pressure is decreasing thanks to the dynamics of the ruble exchange rate, as well as the notable decrease in inflation expectations of households and companies.
In this way, although year-on-year inflation reached 17.8% in April, according to the estimate of last May 20 it would have slowed down to 17.5%, thus decreasing more quickly than contemplated by the Bank of Russia in your forecasts.
Likewise, the Russian issuing institute has also indicated that funds continue to reach fixed-term deposits in rubles, while the credit activity of the Russian banking sector remains weak, which limits pro-inflationary risks and forces monetary conditions to be more flexible.
For its part, it has warned that external conditions for the Russian economy “remain challenging”, which considerably restricts economic activity, although it has stressed that the reduction in risks to financial stability allows for a relaxation of some control measures. capital.