Russia’s central bank raised its key interest rate by 100 basis points on Friday, to bring the inflation to the target. <\/p>\n
The Board of Directors decided to increase the key rate to 6.50 percent from 5.50 percent. The outcome of the meeting came in line with economists’ expectations. <\/p>\n
The bank has lifted its benchmark rate by a cumulative 225 basis points since March.<\/p>\n
The central bank said, “The balance of risks remains significantly shifted towards proinflationary ones.” Policymakers viewed that high inflation expectations may cause inflation to deviate upwards from the target for a longer period. <\/p>\n
Annual inflation is forecast to reach 5.7-6.2 percent this year. Given the monetary policy stance, annual inflation will edge down to 4.0-4.5 percent in 2022 and will remain close to 4 percent further on, the bank said.<\/p>\n